Investigating the bank (1)

February 23, 2008

IndustryI started working with two clients in 2005, Alex and Andrei Oudovikine. It was suggested to me that I take a look at what the Canadian franchise bankers were up to.

Bankers love it when governments guarantee small business loans but not for the reasons most people think but that is getting ahead of the story. Anyway…

I called Industry Canada about it and they suggested I write down my concerns because the Canada Small Business Financing Act was being reviewed. I did that and Predatory Lending, IC Feb 2005.

I waited and I waited.

After one full year (365 days), I called back to see if there were any questions. Within 3 days, I was in a meeting. He suggested I write a consulting Service Proposal. I did that and here it is.

I waited and I waited.

I called Industry Canada back. They wasn’t interested but, hey, he encouraged me to check back in 2011 when the next statutory law review would take place.

So it goes in franchising.

New Zealand banking standards

February 18, 2008

Flattened by franchise master, The New Zealand Herald

Disgruntled Green Acres franchisee Kris Divate explains his case to National MP Pansy Wong at her electorate office. Photo / Martin Sykes

“I borrowed the money to buy this business because I knew the $1000 guaranteed weekly income combined with my income would make the bank approve the mortgage,” said Divate, a civil engineer.

He borrowed $21,393 from FBL Finance Ltd for the ironing business he bought for his wife, Ujwala.

He borrowed another $5000 from Finance Now for ironing equipment he never received, a loan in dispute because Divate claimed neither he nor his wife signed for it.

They have not been making loan repayments but are now feeling the pressure from Finance Now, which is sending them weekly reminders.

“I thought the business could help me own a property in New Zealand. I am now worried that it would make me lose everything instead.”

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