Business finance
Business loans for Australian SMEs, from $10,000
Working capital, stock, equipment, expansion or ATO arrears. Secured and unsecured facilities from banks and specialist SME lenders — matched to what your business can actually document.
Getting the structure right matters more than the rate
Using a term loan for working capital, or an overdraft for an equipment purchase, costs more than picking a slightly higher rate on the right product. It's the most common and most expensive mistake in SME finance.
The other one is applying to a major bank first by default. Banks offer the lowest pricing but decline the majority of smaller commercial applications and take three to five weeks to do it. Industry research suggests around 61% of small businesses abandon a bank application partway through on documentation alone.
Matching product to purpose
| Facility | Best suited to | Typical market range |
|---|---|---|
| Secured term loan | Expansion, acquisition, refinancing dearer debt | ~6.8% – 9.5% p.a. |
| Unsecured term loan | Growth where no property security is available | ~9.5% – 18% p.a. |
| Line of credit / overdraft | Ongoing working capital, seasonal gaps | Varies by facility |
| Equipment finance | Machinery, vehicles, fit-out | Typically below unsecured |
| Invoice finance | Long debtor days on B2B terms | Priced on turnover |
| Short-term / merchant advance | Genuine short-term bridging only | Can exceed 30% effective |
The test that matters
Is the return on the capital greater than the cost of the capital? Borrowing $100,000 at 18% for a year costs roughly $10,000 in interest. If deploying it generates $40,000 in additional profit, that was excellent value. If it generates $5,000, it was a loss — and the rate was never the problem.
Business loan cost calculator
Work out the true cost of a facility, including an establishment fee.
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- Total interest
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- Establishment fee
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- Total cost of finance
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What lenders assess
The five things that decide your rate
Security
Whether you can offer property or business assets. This is the single biggest lever — the gap between secured and unsecured pricing is commonly four to six percentage points.
Trading history
Businesses past two years see materially higher approval rates. Past three years with consistent revenue, some specialist lenders approve the large majority of applications.
Revenue consistency
Lenders increasingly assess live cash flow through accounting software rather than historical statements alone. Clean, current books help more than they used to.
Industry
Hospitality, construction and highly seasonal businesses face tighter policy across most unsecured lenders. Not a barrier, but it narrows the panel.
Director credit
Your personal credit file is assessed alongside the business, particularly where a guarantee is required.
Documentation
BAS, bank statements, tax returns and an accurate ATO position. Preparation is the difference between an approval and a decline more often than the numbers are.
Before you apply
What to have ready
- Six to twelve months of business bank statements — the primary document for most non-bank assessment
- Recent BAS lodgements and your current ATO position, including any payment plan
- Financial statements or tax returns for the last one to two years
- An accurate figure for existing business debt, including equipment finance and any short-term facilities
- A clear purpose — lenders assess "$80,000 for stock ahead of the December quarter" far more readily than "$80,000 for working capital"
A note on the instant asset write-off
The $20,000 instant asset write-off is a permanent measure for small businesses with turnover under $10 million. Where you're funding equipment, that can change the after-tax cost materially. Talk to your accountant about the timing — it's their call, not ours.
FAQ
Business finance questions
How much can my business borrow?
Unsecured facilities in the Australian market are commonly capped around $250,000 and are typically sized against monthly turnover. Secured lending — usually against residential or commercial property — goes considerably higher and prices lower. RBA data shows secured loans are on average several times larger than unsecured equivalents.
Do I need to have been trading long?
Most non-bank lenders want at least six to twelve months of trading and a minimum annual turnover, often somewhere between $60,000 and $100,000. Banks generally want two years or more. Businesses under twelve months old without security face materially lower approval rates, though options do exist.
Will I have to give a personal guarantee?
Almost certainly, for unsecured lending. 'Unsecured' means no specific asset is pledged — it does not mean the lender has no recourse. A director's guarantee makes you personally liable if the business can't repay, which can put personal assets at risk. Read that clause carefully and get advice on it if the amount is significant.
What's a factor rate, and why does it matter?
Short-term lenders sometimes quote a factor rate rather than an annual percentage rate. A factor rate of 1.25 on $100,000 means you repay $125,000 in total. Over a short term, that converts to an effective annual cost far higher than the number suggests — frequently 30–50% or more. Always convert a factor rate to an annualised figure before comparing it to anything else. Our calculator works in annual rates for this reason.
Can I refinance ATO debt?
Sometimes. A number of Australian lenders will fund ATO arrears, though the pricing reflects the risk and some will want a payment plan already in place. It's become a reasonably common funding driver for SMEs.
How fast can it be funded?
Specialist SME lenders often approve within 24 to 72 hours and fund inside a week. Major banks typically take three to five weeks on smaller commercial facilities and decline a large share of applications under $1 million. Speed generally costs you rate — the question is whether the opportunity you're funding justifies the difference.
Get your business funding structured properly
Tell us what the money is for and what your business can document. We'll come back with the lenders that realistically fit.
Checking your options does not affect your credit score. A credit check is only done if you decide to apply with a lender.