Fast Loans for Small Business
With many business loans, you might find that the turnaround time for your application can be anything from a few days to a few weeks. This might not be an issue if your small business loan is part of some longer–term improvements. If you’re planning to move to a bigger workshop in a few months, for example, then you won’t mind waiting for the application to be approved.
However, sometimes you might need the funds within a matter of hours or a couple of days. You might think that this isn’t possible with business loans, but there are some providers that can approve your application and have the funds to you within 24 hours.
Is a fast business loan right for you?
Very often, fast business loans are for smaller amounts – maybe you have a seasonal slump in sales or you need to make some sudden repairs to your premises – and so a small cash injection with quick approval is ideal.
How rapid can turnarounds be for fast business loans?
Of course, turnarounds vary between lenders, but many fast loan providers can approve your application within a matter of hours and get the funds to you within by the next business day.
In general, non-bank or fintech lenders have faster turnarounds than the bigger banks – it’s their selling point.
What sorts of amounts are available to borrow?
Most business loans start at $5,000 but there are differing maximum amounts. Some max out at $25,000, while others go up to $500,000. However, the amount you’ll be eligible for will depend on several factors, including:
- Your business’ cash flow and its immediate projections
- The reason for the loan – some reasons are “better” than others, such as needing to buy fancy new equipment that will increase your profits
- How long your business has been in operation, and
- Your credit history, as well as that of any partners and directors.
You’ll be able to explain your reasons and provide all the necessary information when you make your application. Before you think about making any applications, however, you need to make sure your business is eligible, in terms of turnover and length of operation. Never be tempted to apply for a loan if you don’t fully fit all the criteria.
Reasons that a business may want a fast loan
To help with a dip or restriction in cashflow
Lots of businesses have issues with their cashflow at times. This could be due to buying new inventory or equipment, or an unusual economic event that’s temporary and (hopefully) rare.
To help with the purchase of new equipment or other infrastructure
Small business loans can help you to buy new machinery or equipment that will help your business to expand operations or to bring down your production costs.
To help your business to expand
A loan can help with the hiring and training of new employees, buying more stock or raw materials or moving to larger premises.
To consolidate existing debts
If you have a few separate debts that are taking up a lot of time to service each month, then bringing them all together under one umbrella can save time and effort. You may also find that your interest rate is better.
How do I compare fast business loans?
You’ll need to examine a few factors when you’re comparing business loans before you decide which one is best for you and your needs.
The turnaround time
If you’re looking for fast loans, then you need to narrow your search down to providers that can assess and approve your application and deliver the funds within 24 hours or so. If it’s not quite so urgent, then look at providers with turnaround times of a week or more.
The repayment term
This term could be anything from three months to five years, so work out how much you can afford to pay back each month while clearing the loan in a timeframe that doesn’t generate loads of interest.
The upfront and ongoing fees
Most loans involve some fees, like set–up fees, service fees, early repayment fees and so on. If you see a loan with no fees, look at the interest rate as it may be higher than others. Similarly, high fees may mean lower interest rates.
The interest rates
You may prefer fixed rates or variable rates, depending on the length of your repayment terms. Fixed is better for longer terms.
Secured or unsecured?
Secured loans, where you offer business or personal assets as collateral, often have lower interest rates and longer terms, so decide which works best for you.
Am I eligible?
Lenders have different eligibility criteria, but make sure you know what the requirements are before you apply. Requirements include:
The length of operation
Many new businesses fail, so lenders want to see that you’ve been operating for at least a year.
If you have a regular and steady turnover then this gives lenders confidence in your ability to repay any money that they lend to you.
Your credit history
If you, as the business owner, has a poor credit history, this could make you less eligible.
You’ll need your Australian Business Number or Australian Company Number to apply.
How to apply for a small business loan
Once you’ve selected your ideal provider from the comparison site, you should hit the “Go to Site” button on the comparison panel and take it from there. You’ll need some of your business’ details to hand to get through the first stage of the application, so make sure they’re there.
There are also other finance solutions available
A line of credit
A line of credit is a revolving debt; you have a pre-defined limit of credit that you can draw down on and it’s “replenished” as you pay it back.
A business credit card
This works in the same manner as a personal credit card but it’s dedicated for business purchases and purposes. These cards often have a few extra features like special rewards points and the ability to nominate additional card holders.
A business overdraft
With this product you can overdraw your business bank account (up to a limit). You only pay interest when you’re overdrawn, but you may have to pay a monthly fee for the option to overdraw.
The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. If you or someone you know is in financial stress, contact the National Debt Helpline on 1800 007 007.