Negotiating Better Terms on Your Existing Bank Facilities
How to use your own data to renegotiate interest rates, processing fees, and covenants — without switching banks
Who this is for
SMEs with existing bank facilities (CC, OD, TL, or LC) that have been in place for 2 or more years, where the terms have not been formally reviewed. Particularly relevant for businesses whose financial profile has improved since the facility was first sanctioned.
What it costs you to ignore it
The diagnosis behind it
This playbook is triggered by a Red or Critical finding on:
Vital 3 — Banking & CreditThe Protocol
Compile your credit track record with the current bank: 24 months of clean repayment history, average utilisation, turnover routed through the account, and any collateral provided. This is your negotiating file.
Obtain term sheets or indicative offers from at least two competing banks or NBFCs. You do not need to intend to switch — you need a credible alternative on paper.
Request a formal review meeting with your relationship manager and their credit head. Present your track record file and the competing offers. Ask specifically for: rate reduction, processing fee waiver on renewal, and relaxation of any restrictive covenants.
Evaluate the bank's counter-offer against the competing offers on total cost of credit — not just headline rate. Include processing fees, insurance requirements, and collateral margin calls.
If the current bank does not move: switch at least one facility to the competing bank. This establishes that the threat is real and typically prompts the incumbent to match terms at the next renewal.
What you can do yourself vs what needs help
Steps 1–4 are executable internally by a capable CFO. If your CFO is not experienced in credit negotiation, an advisor can prepare the negotiating file, coach the conversation, and help evaluate the competing offers — typically recovering their fee in the first year's interest saving.