Advisory Insight
Why credit committees reject feasibility studies — and how to fix yours
Advisory Desk · ·
Credit committees rarely reject projects in the first reading. They reject documents they cannot test. The difference between a financed project and a rejected one is usually traceable to five omissions.
1. Assumptions without sources
Every price, volume and growth rate needs a citation: a contract, a quotation, a published series. Unsourced assumptions are read as optimism.
2. One scenario, no sensitivity
A single base case tells the committee nothing about downside. Show break-even, and show what happens at 80% of your price and volume assumptions.
3. Working capital ignored
Projects fail on cash, not on profit. Debtors days, stock days and creditor days must appear in the funding plan, not just in an appendix.
4. Implementation without owners
A schedule without named responsibilities reads as a wish. Committees fund teams, not timelines.
5. No independent hand on the numbers
A study prepared and signed by the borrower is evidence of intent; a study reviewed by Chartered Accountants is evidence of arithmetic. Banks price the difference.
The committee is not asking whether your project is good. It is asking whether your numbers survive contact with reality.
Prepared by
Advisory Desk · Baral & K.C. Associates
This note is general guidance and not advice on your specific facts. Rates, thresholds and deadlines change; confirm the current position before acting.
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