Plight of Financing: Rejected by Six Banks Consecutively Due to Lack of Real Estate Collateral

A small and medium-sized agricultural product processing enterprise is at a critical juncture of development — to expand production scale and enhance product competitiveness, the enterprise plans to purchase an automated production line. However, an insurmountable obstacle stands in the way: the lack of real estate collateral.

In the following two months, the enterprise submitted loan applications to 6 banks successively, all of which were rejected due to "no qualified collateral". For this enterprise rooted in rural areas and focusing on traditional brewing techniques, the lack of financing means that the production expansion plan has to be shelved, and it also means missing market opportunities. The enterprise's predicament reflects the common financing pain point of the majority of agriculture-related small and medium-sized enterprises: having technology, orders and prospects, but lacking the real estate and land that banks value most.

Professional Intervention: Tapping "Dormant" Assets and Restructuring Financing Logic

After receiving the enterprise's entrustment, the financial legal service team of our firm did not continue to hit a wall along the old path of "finding collateral", but took a different approach — helping the enterprise tap the value of its own "dormant" assets and restructure the bank's credit granting logic.

The team established an innovative idea of "confirmation of intangible asset rights + pledge of current assets", converting the enterprise's intangible cultural heritage value and stable orders into financing targets acceptable to banks.

Asset Tapping: Confirmation and Quantification of Two Core Values

1. Intangible Cultural Heritage Certification of "Traditional Brewing Craft" with a Brand Value of 5 Million Yuan

First of all, the team assisted the enterprise in systematically sorting out the historical inheritance and technical characteristics of the "traditional brewing craft" and preparing application materials, successfully completing the intangible cultural heritage certification.

On this basis, we jointly with professional appraisal institutions conducted a quantitative evaluation of the brand value of this craft, and finally determined that its brand value reached 5 million yuan. This certification and evaluation transformed the originally intangible craft into quantifiable intangible assets, providing the first layer of support for financing.

2. "Order Confirmation" of Annual Supply Contracts, 3.8 Million Yuan of Accounts Receivable Included in Pledge

At the same time, the team comprehensively sorted out the annual supply contracts signed by the enterprise with 3 large supermarket chains, and included 3.8 million yuan of expected accounts receivable into the pledge scope through the "order confirmation" procedure.

The so-called "order confirmation" refers to converting future accounts receivable into definite assets with pledge value through in-depth verification of the authenticity of contracts, performance capabilities and payment collection paths. This process requires both professional legal judgment and a profound understanding of industry transaction habits.

Scheme Design: Promoting Banks to Accept the New Guarantee Combination of "Intellectual Property + Orders"

Asset tapping is only the first step; the real difficulty lies in: how to make banks accept this new type of guarantee combination?

Legal Opinion Letter Alleviates Banks' Concerns

Aiming at the two issues that banks are most concerned about — how to realize the collateral and how to dispose of risks — the team provided professional legal opinions:

• Design of Realization Path: Sorting out possible paths for licensing and transfer of intellectual property rights, and clarifying the operation process of accounts receivable transfer
• Risk Disposal Mechanism: Presetting the disposal plan of collateral in case of breach of contract, and clarifying the rights, responsibilities and operation steps of all parties

The Guarantee Combination is Recognized

After multiple rounds of communication and scheme optimization, we finally promoted the bank to accept the new guarantee combination of "intangible cultural heritage brand value + accounts receivable pledge", and agreed to issue a credit loan of 3.5 million yuan to the enterprise.

What's more noteworthy is that the comprehensive financing cost has been reduced by 2.3 percentage points compared with traditional loans, which has greatly reduced the financial burden of the enterprise.