The loan interest rate is lower than the deposit interest rate of the company account.
If the deposit interest rate in the company's account is lower than the bank loan interest rate, then the company can obtain more funds by borrowing from the bank for business development and new projects. In this case, the company can make more profits while paying interest.
Loans are used to improve credit rating.
Sometimes, companies will improve their credit rating by borrowing from banks. In some cases, there is enough cash in the company account, but if it is necessary to expand business or launch new projects, banks may be more willing to provide loans to companies with good credit. At this time, the company can choose to borrow from the bank to improve its credit rating, so as to obtain better financing conditions.
Maintain liquidity
Even if there is enough cash in the company's account, it may be used for emergency operating expenses or other expenses, resulting in the company not having enough cash flow in the short term. In this case, the company can choose to borrow from the bank to maintain liquidity and ensure that the necessary expenses can be paid in time.
In short, companies choose to borrow from banks, even if there is enough cash in their accounts, there may be many reasons, such as spreads, improving credit rating, maintaining liquidity and so on. The specific reasons depend on the company's business strategy, financing needs and financial situation.