It depends on the amount of financing your company is seeking to raise.
Different banks have different credit criteria, lending appetites, industry restrictions and limits on how much they are prepared to lend to a particular business.
If a company needs a substantial amount of financing, relying on one bank alone may limit the financing available.
At the same time, sending the same application to every bank is not a strategy.
The better approach is to assess the business first, identify the suitable lenders and financing facilities, and then decide how the applications should be structured.
Why one bank may not be enough
A bank’s approval is based on its own credit assessment.
The same company can receive different outcomes from different banks because each lender has its own credit policies, lending appetite and limits.
This becomes more important when a company has a larger funding requirement.
If the business needs a substantial amount of financing, the amount one bank is prepared to offer may not be enough to meet the full requirement.
This does not necessarily mean the company cannot raise more. It may simply mean that the particular bank is not prepared to take the full exposure.
That is where considering other suitable lenders or financing facilities can become relevant.
Why you should not apply everywhere
The answer is not to submit the same application to ten banks and wait to see who says yes.
Some lenders may not accept the company’s industry.
Others may have a company-vintage requirement that the business does not meet.
Another lender may not be suitable for the amount being requested or the type of financing required.
Submitting to lenders that are unlikely to consider the case creates unnecessary work without improving the underlying application.
The objective is not to submit more applications. It is to submit to the right lenders.
How we approach a multi-bank financing case
Before deciding where to submit a case, we look at the business and the funding requirement together.
We consider factors such as:
- Company financial performance
- Bank statements and account conduct
- Existing financing
- Company vintage
- Industry and business activities
- Ownership and Personal Guarantee structure
- Amount of financing required
- Purpose of the financing
From there, we determine which financing facilities and participating banks may be suitable.
The application is then prepared around the actual requirement rather than simply sending the same set of documents to every lender.
Where appropriate, more than one lender may be approached so that the overall financing requirement can be assessed across suitable options.
What if one bank offers less than you need?
This is one of the main reasons a multi-bank approach can be useful.
Suppose a company requires S$500,000.
One bank may be comfortable with S$200,000 based on its assessment.
That does not necessarily mean S$200,000 is the maximum the company can raise.
Depending on the company’s profile, we may assess whether another lender is suitable, whether a different financing facility can be used, or whether the overall requirement can be structured across different facilities.
For example, one lender may be suitable for part of the requirement while another financing route may be considered for the balance.
The point is not to force a particular quantum through every bank.
It is to understand what each lender is comfortable with and how the overall financing requirement can be structured.
Why lender selection matters
Not every bank is suitable for every business.
A lender may have a strong appetite for one industry but be more restrictive on another.
A bank may be comfortable with an established company but require a longer operating history for certain businesses.
Another may take a different approach to existing liabilities, profitability, credit profile or financing quantum.
This is why we do not start with:
“Which bank should I apply to?”
We start with:
“What is the business trying to achieve, and which financing routes are suitable for this profile?”
The lender comes after the assessment.
What happens when we handle the case
At Cornerstone Capital Services, we manage the financing process around the business’s requirement.
This includes assessing the company’s profile, identifying suitable financing routes, determining which lenders are worth approaching, preparing the case and coordinating with the relevant banks through the application process.
Where several lenders are appropriate, we manage the applications as part of the overall financing strategy rather than treating each submission as a separate exercise.
This is particularly useful when the company is looking for a larger quantum or when there are multiple financing options to consider.
Does applying to several banks guarantee more financing?
There is no guarantee that every lender will approve the application or that the full amount requested will be obtained. Each lender makes its own credit decision.
However, the purpose of a properly structured multi-bank approach is to increase the potential overall financing available by considering suitable lenders with different credit appetites and financing facilities.
If one bank is unable to meet the full requirement, another suitable lender or financing facility may be able to address part of the remaining requirement.
The objective is therefore not simply to apply to more banks.
It is to maximize the financing outcome by approaching the right lenders and structuring the requirement properly.
How many banks should be considered?
There is no fixed number.
A straightforward financing requirement may only require a small number of suitable lenders.
A larger or more complex requirement may justify considering several banks or different financing facilities.
What matters is whether each lender has a genuine reason for being considered.
Shortlist first. Submit second.
The bottom line
Applying to several banks can make sense when the financing requirement is large or when different lenders may offer different financing options.
But there is a big difference between a multi-bank strategy and simply applying everywhere.
A proper approach is:
Assess the business → understand the funding requirement → identify suitable financing routes & strategize → shortlist the relevant lenders → submit the case.
That is how we approach multi-bank financing at Cornerstone.
Speak to us about your financing requirement
If your company is looking to raise financing and you are unsure which banks or financing facilities are suitable, speak to us before submitting applications.
Send us your company name, approximate amount required and purpose of funding.
We can assess the overall profile and determine which financing routes and lenders may be worth considering.
The goal is not to apply to the all banks. It is to structure the financing properly and approach the lenders that fit the business.
