Australian Fast Unsecured Business Loans

  • Updated: April 9, 2021
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Australian Fast Unsecured Business Loans

Unsecured business loans are a fast option for Australian business owners for cash flow relief. With no capital, businesses cannot grow so unsecured loans have become the most popular option for Australian small businesses in need of business finance. There are a number of reason why unsecured loans are popular including:

1. Access and ease

Traditional lenders such as have stringent criteria to qualify for a loan such as a profitable trading profile and good credit.

Many small businesses struggle to meet the bank’s criteria and/or don’t have the means or time to prepare the paperwork such as financial statement and credit history that banks require for proof

There is now a wealth of fintech lenders with more relaxed eligibility criteria that often don’t require paperwork such as bank statements to qualify for a loan. Some lenders will even lend if you have a poor credit score.

To qualify for a loan, unsecured lenders simply need your ABN number, to show have a minimum monthly turnover of $4,000 a month or an annual turnover of over $50,000 per annum.

Unsecured loans also require a minimum trading history of 3 to 6 months and in some cases a minimum credit rating.

While unsecured loans have higher interest rates than secured loans, business often finds the costs to get immediate finance is a worthwhile sacrifice.

2. No need for collateral or assets

Many businesses do not have collateral or security to offer for a secured business loan. Many small business owners prefer unsecured loans over the risk of using personal property as security.

As a small business owner, it can be smarter to pay higher interest than lose your home, if the business cannot repay the loan.

3. Easy application

Most unsecured online application forms can be done online in under 10 minutes with just a few basic steps. Loans under $150,000 require few supporting documents as they link directly to your financial accounts.

As a business with many competing priorities, an easy business loan application process is a big appeal.

4. Speed

Traditional lenders can take weeks and sometimes months to assess loan applications. The application process for unsecured loans takes advantage of technology to assess applications on the spot by checking the business creditworthiness and business data.
Some lenders can provide loan approval and provide business funding on the same business day.

5. Convenience

There are is no shortage of online unsecured SME lenders offering small business loans of all types of loans with no security.

Loan options include short-term business loans, working capital loans, bad credit loans, merchant cash advances, business line of credit, bank overdrafts, asset finance, fit-out finance, import finance, invoice finance and in rare cases, start-up loans for new business.

Whether you need an upfront lump-sum payment with a business loan or access to a credit facility through a business credit card or line of credit, you should be able to find the right loan for your business.

6. Flexible Loan online

Among the many unsecured business lenders, chances are you will find an unsecured small business loan that can best meet your requirements as a borrower.

This may be in the form of larger loan amounts. Most loans start from $5,000 and some go as high as $1,000,000

Longer repayment terms with loan terms can range from 1 month to 36 months.

With flexible pricing, business lenders will work with you to find a loan that works for you as part of the approval process.

Friendly repayment schedules then can be daily, weekly, monthly and even seasonal with loan repayments done with direct debit.

Some SME lenders also have no hidden costs and will accept early repayment with no fees or costs.

As long as you are using the loan for business purposes and meet the business lender eligibility requirements, getting a loan should be straight forward.

Unsecured Business Loans FAQs

Is a small business loan secured or unsecured?

Most short term loans in Australia are unsecured based on flexibility, faster approval times and a more straightforward loan application process. A secured loan is more suitable when the loan amount is higher and required on a long-term basis. Primarily businesses choose a secured loan when purchasing long term assets such as vehicles or equipment.

Can you get a small business loan with bad credit?

Yes, in most cases an Australian business with bad credit are eligible for an unsecured business loan. This is because eligibility is less based on the credit score of the business and more focused on working capital requirements and the ability to pay back the line of credit based on recent history. This is determined by viewing the borrower’s bank statements focusing on monthly turnover to access the creditworthiness of the business.

What happens if you default on an unsecured business loan?

When you default a business loan the lender may renegotiate business finance options or take the matter to court to collect the repayments. Some provider may also use a debt collection agency that goes through processes to collect the funds on the lender’s behalf. Additional fees will be charged on funds reclaimed and interest rates may be increased to cover default costs such as the debt collection agency.