We provide Solutions for all Borrowings
MonyOrdr facilitates all types of borrowing requirements of companies, which could be broadly classified as:
Annual renewal of existing Borrowing
Refinancing of Borrowing
Restructuring of Borrowing
All the types of borrowings that are mobilised by companies would fall into either of the above categories and MonyOrdr does it all for you.
New Borrowing: MonyOrdr assists in new borrowing raised by companies from Banks/NBFCs/Others.
The purpose of new borrowing could be financing capital expenditure, project finance, purchase of shares/investments, acquisition finance, dividend payment, purchase of vehicles, etc.
New borrowings add to the total borrowings of a company and increase its indebtedness (Debt/Equity).
Lenders assess the debt servicing capacity of the company to determine the feasibility of new borrowings.
Typically, the liquidity from the borrowing would add to new assets that would generate recurring income for the company that would be utilised to service the new borrowing.
Annual Renewal: MonyOrdr enables Annual Renewal of facilities for companies, which ensures continuity of existing facilities either at the existing level or at an enhanced level.
Banks relook at their existing loans/financing on a regular basis. Typically, lenders undertake a comprehensive credit assessment exercise of all their existing exposures on an annual basis, which in their parlance is referred to as Annual Renewal.
Lenders take such a comprehensive assessment exercise on a semi-annual/quarterly basis for their problem exposures.
Banks undertake Annual Renewal due to the following reasons:
Monitor existing exposure on a periodic basis
The changing market dynamics necessitate Banks to remain agile and take timely action.
Determine the income earned from the relationship.
Build a road map for the banking relationship with a client for the coming year.
Amendments in terms of the facilities to meet the requirement of companies, essentially for the working capital facilities.
View to enhance/maintain/reduce the working capital facilities, which are typically extended for a year.
Refinancing: MonyOrdr meets all the refinancing requirements of companies and makes sure that the new terms are favorable to companies.
Refinancing involves replacing an existing loan with a new loan that fully repays the original loan. The new loan should ideally have better terms and conditions that justify the process.
Refinancing a company's debt in response to market conditions like favorable interest rates can go a long way towards strengthening the financial position of the company.
Competition among lenders in the corporate debt financing market is leading many companies to evaluate refinancing options.
Refinancing could be undertaken for more advantageous terms i.e., extend repayment profile, free up cash flow, or even increase their leverage to build out operations and pursue acquisitions.
Debt terms negotiated even one to two years ago can be substantially different from the current environment, refinancing allows companies to “refresh” their debt facilities to current market terms and conditions.
It is a sound business practice to annually review a company’s debt structure to determine: (i) if the debt facility maps well to the company’s current business model and (ii) if the terms and conditions would compare favorably to optimum terms and conditions in the current market.
Restructuring: MonyOrdr facilitates the Restructuring of borrowings of companies and ensures that the Restructuring terms are feasible and would be achieved by companies.
Restructuring is a tool to work out the problems of a Company that is facing financial difficulties, without pursuing collateral execution or legal process.
If a Company fails to repay the Facilities in compliance with the Facility Agreement, the Bank may request the repayment of Facilities. If necessary, the Bank may initiate a legal procedure and/or collateral execution. It is in all parties' best interest the Company contacts the Bank as soon as possible when financial difficulties are identified, to start the discussions with respect to the restructuring of Facilities.
The restructuring should start when the Bank believes that a stable repayment schedule might be established, and the Company will be able to pay the restructured Facilities in accordance with the new terms and conditions.