How to get a business loan in Latvia

Step-by-step process

Define your financing need

Before applying, clearly define:

How much you need
For what purpose (working capital, investments, refinancing)
What tenor is acceptable
Whether collateral is available (real estate, equipment, guarantee)

Prepare financial documents

Financial institutions typically require:

Annual reports for the last 2–3 years
Operational balance sheet (no older than 3 months)
Bank account statement for the last 12 months
Cash flow forecast
Business plan (for investment projects)

Submit the application

You can submit the application directly to a bank or via a financing broker. Working with a broker, the application is sent to several institutions in parallel, significantly increasing the chance of receiving the best offer.

Evaluate offers

Compare the main parameters:

Interest rate (fixed or floating)
Loan tenor
Monthly payment
Commissions and additional fees
Collateral requirements

Sign the contract and receive funds

After approving the offer, contract documents are prepared and signed. Funds are typically transferred within 1–5 business days after signing.

What banks assess when reviewing an application

Turnover and financial history

Banks typically require at least 2 full financial years. Not only the volume of turnover matters, but also its stability and growth dynamics.

EBITDA and debt service capacity

EBITDA (earnings before interest, taxes, depreciation and amortisation) shows operational earning capacity. Banks calculate DSCR (Debt Service Coverage Ratio) – if it is below 1.2, financing will most likely not be approved.

Equity

Negative or very low equity signals financial instability. Banks expect equity to total assets ratio of at least 20–30%.

Collateral

Real estate, equipment or inventory can serve as collateral. But it is important to understand – collateral alone does not guarantee approval. Cash flow is assessed first.

Common mistakes when applying for financing

Incomplete documents

delay the process and create a negative impression

Chaotic applications to multiple banks

can damage reputation and reduce chances

Unrealistic forecasts

banks rate overly optimistic plans as risk

Ignoring balance sheet structure

low equity or hidden debt is often a reason for refusal

Poor credit history

tax arrears, litigation or missed payments

How to improve your chances

Tidy up the balance sheet – increase equity, optimise asset structure
Prepare a quality business plan with realistic forecasts
Resolve tax debts and arrears
Choose the right type and amount of financing
Work with an experienced financing broker who knows the market

The role of Oferta Finance

Oferta Finance takes on the entire financing process – from preparing documents to comparing offers and signing the contract. We represent the company's interests and work with 50+ financial institutions in Latvia and the Baltics.

Since 2019, we have helped 250+ companies secure financing, structuring deals totalling more than €100M.

Learn more about business loans →