Short-term Business Finance
Unsecured Business Loans to $100K Simple
Trading 9 months+ | No financials | No security | Up to 100% of monthly turnover | Fast settlement
What are the Advantage of Short-term Business Finance?
- High approval rate for small business owners, ABN 6-12 months with good evidence of trading history.
- To obtain approval for short-term business finance is to demonstrate the capacity to repay the loan.
- The key benefit of unsecured business loans is NO collateral or security is required, protecting your assets.
- Short-term business finance can fund daily operations or invests in new products and services.
- The advantage of using unsecured business loans is fast settlement within 1 to 5 days.
- Business must be operating from leased premises or show proven online trading and consistent sales.
- With short-term business finance the lender takes the risk, and carefully considers your overall credit risk.
How Short-term Business Finance Works
100% business revenue lending. No collateral. Protect your assets
To $100K. P & L plus 6-12 months business banking statements
From 3 to 18 months for cash advances, invoice finance and LOC
Choose loans with daily, weekly or monthly repayment schedules
Free quote and quick pre-approval. Indicative offer same day
In 1-3 days provided all info is supplied with application
Unsecured Business Loans is risk-based lending
- Working capital is the money you need to run the business day-to-day while you wait for money from sales to come in.
- This includes stock, cash in the bank plus debtors. minus liabilities, such as creditors, tax accruals and any short-term business finance to service.
- Having insufficient working capital can impact on your cash flow and cause your business to fail.
- To understand your working capital needs, you should prepare a monthly cash flow budget for the 1st 1-2 years.
- Then research the best unsecured business loans considering your trading history, industry or sector with the funding cost.
- Some working capital loans are unsecured. This simply means that your company is not required to put down any collateral to secure the loan. This is risk-based lending, so only companies and owner / directors with an above average credit score are approved for short-term business finance.
What are the benefits of Unsecured Business Loans
Small Business, or large and established companies need funding to grow. There are many sources of finance and many factors that will influence which funding works best for you. The primary reasons for using short-term business finance are;
- working capital to continue operating while waiting for invoices payment
- purchase of operating equipment or updating to new technology
- deposit for shipments of raw materials and components already committed to production
- intention to undertake a particular project or commencement of a new contract
- acquire another small business or franchise opportunity
- need to refinance existing liabilities or payout a business partner
- difficulty obtaining traditional bank finance with no security to offer
Short-term Business Finance Analysis
- What is the right short-term business finance solution that works with your small business?
- What type of capital and term would suit your?
- Have approached your bank and discussed their criteria?
- Have you compared unsecured and collateral loans?
- Can the small business service more unsecured debt?
- Have you implemented collection procedures to manage debtors?
- Have you considered funding your insurance premiums?
How to Qualify for Short-term Business Finance
- Solid evidence of trading over 9 months
- Rental premises and lease agent details
- Electronic upload of 6 months business bank statements
- Financials for deals above $100K
- Outstanding overdraft and other unsecured business loans
- Evidence of any paid defaults
- 100 PT Owner ID including driver licence
Short-term Business Finance Alternatives
Every small business will experience late payers during its existence. Whether this from many small monthly customer’s or one large client from an ongoing project, it can leave SMEs struggling with cash flow problems due to the payment gap between products or services delivered, and the invoices paid.
If this toxic customer payment pattern continues for weeks or even months, it is time for a small business to look for alternative capital to alleviate the cash flow problems affecting its business. The solution could be through unsecured business loans to provide the much-needed short-term funds or invoice financing to cover this gap. More information on short-term business finance option on our FAQ page.
The other option is collections and engaging a solicitor in demanding the invoices owed are repaid where the age of the debt is 60 days plus. Many small business owners are reluctant and cautious about upsetting existing and new customers plus the added expense and time of chasing late payments through legal methods.
To better manage the financial stability of the business; accessing short-term business finance are a proven strategy to smooth cash flow. When a smart business operator can preempt, deal with and prevent late payments, the small business will undoubtedly be more profitable, enjoy consistent growth and enable expansion through equity investment, which ultimately guarantees the business a bright future ahead.
Understanding Short-term Business Finance
Unsecured business loans provide a broader choice of finance options for a small business owner; however, it does come with a higher cost compared with the bank. Unsecured lenders charge higher rates because their loans generally have a higher level of risk. Yet, despite their higher cost compared with a bank’s secured small business loan, they provide a higher level of value for money and can have more impact on a company that needs money to grow.
Unsecured business loans are structured over the short-term with flexible repayments. This helps the borrower keep the cash flow in the company to fund everyday working capital requirements. It must be noted that short-term business finance sits behind secured notes and usually are in second position in the capital structure. A good working capital management strategy is to spread your funding across a secured traditional lender and short-term business funder to better manage your cash flow.
Short-term Business Finance – the good, the bad and the ugly
Thanks for the huge advances in fin-tech online lending, unsecured business loans are now easily available as cash flow loans, from short-term business finance to lines of credit to fast pre-payment if your invoices. The risk factor for the lender is high, so is the interest charged on short-term business finance, which is spread over a short-term of 12-24 months, have fueled the popularity of unsecured business loans in the SME market today.
The Good – of Short-term Business Finance
One of the primary reasons of accessing unsecured business loans is the ease-to-meet requirements. There is no need to put up your home or other assets to meet traditional bank requirements. When applying for short-term business finance, the business must show trading history with a decent credit score.
They can be used for any business purpose and are very flexible for new business owners. Find a lender where their payments schedule suits you, such as daily, weekly or monthly, and see if any adjustments to the payment term can be made. It is very important that the business can afford the repayments. To maintain your good credit rating.
The Bad – of Short-term Business Finance
The biggest downside of short-term business finance is the high cost compared the loan where security is taken to underwriting the loan such as real property, vehicles or equipment. The lender adds on extra interest and other fees to compensate for default risk.
The high interest rate is more prevalent on large amount of money for a short period of time such as 12 months, and interest is capitalized. If you take short-term business finance, you need to ensure the benefit of the money will far out way its costs.
The Ugly – of Short-term Business Finance
Unsecured business loans are very easy to take out; the daily, weekly or monthly repayment amount is also very affordable in most cases. The worst way to manage your cash flow borrowing is not have a solid financial plan in place.
As the approval is based on the business cash flow, most reputable short-term lenders will calculate your ability to repay the loan within the term. However, the lender is not running your small business, and you are solely responsible to manage the cash-in and cash-out ratio, to ensure good financial management of your short-term business finance strategy.