Business funding

Growing your business will inevitably put a strain on your cashflow. To grow you will likely have to invest in marketing, invest in more staff, and invest in resources to enable growth.

That’s why understanding and accurately forecasting your growth rates and cashflow is crucial. It should give you a clear picture of what lays ahead and when it’s safe to invest for growth.

How much you can borrow depends on a number of factors, including:

• Your revenue.
• How long you have been in business.
• If you have property you can put up as security.
• If the loan is secured or unsecured by an asset or a guarantee from directors of the company.

Typically, an unsecured business loan will be $25,000 to $250,000. A secured loan can be anywhere from $250,000 plus.

This will depend on whether the loan is secured by an asset or is unsecured.

• An unsecured loan is typically between 10% and 15%
• A secured loan is typically between 5% and 10%

The interest rate is at the discretion of the lender; they will adjust the rate depending on how risky they assess the loan to be. If you have not been in business long and your cashflow is not straight forward, expect the interest rate to be higher.

Traditionally, your only option was to ask your bank for a loan or an overdraft. The rise of FinTech businesses in recent years has massively expanded your small business loan options.

Thanks to online accounting, tech-savvy lenders can now connect to your online accounting profile, understand your business and fund a loan for you in 24 hours.

For larger loans of $250,000 or more, then banks tend to have the best rates. For smaller loans that you need quickly, its best to look at the newer lenders such as Banjo, Prospa, and Moula.

This will depend largely on who you are borrowing from. You can expect a bank loan to take anywhere from two to six weeks. Fintech lenders can typically get a loan funded in one to seven days.