We have a partner whose business model comprises:
- invoice financing - they pay their clients’ invoices and then obtain the invoice payment direct from their clients’ customers
- small business loans - they lend companies money for machinery and equipment purchases. These are unlisted companies.
I’d love an answer asap if possible - thank you.
I know this community is extremely slow-to-answer, so just checking-in in a last attempt for an answer - thanks all.
We will have to go ahead with our ‘best guess’ I belive.
Please see the revised Table 5.2 of the draft Near-Term Financial Sector SBT Guidance Version 2 for some more detailed specifications that are proposed. As both should fall under loans, the minimum coverage requirements would depend on a few things such as what entity they are extended to (e.g., consumer, SME, or corporate; and if the latter, potentially what sector it belongs to and whether it is listed/private) and if the loan is short- or long-term.
Hi @HowardS thanks so much for helping with this answer. From Table 5.2 it appears to me that it would be optional to include a short-term (less than 1 year) loan to a non-fossil fuel company?
Based on the proposed Table 5.2 in the draft Near-Term Financial Sector SBT Guidance Version 2, yes.
Thanks so much for your help!