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Business Loans & Financial Packages 

Now that you know how business loans work and what types of business loans are out there, let’s dive deeper into how to find the best business loan product for your business. Whether you need to raise cash quickly, refinance your assets, consolidate debts, start or grow a business, find the right financing option for your business.

Every small business lender here has been verified by us and comes with genuine user reviews so you can choose confidently from credible names in the market. 

Find out how to apply for the latest and most popular SME business loan products and packages with attractive interest rates and terms and conditions. 

How do I compare business loans in Australia? 

Here are some questions to ask yourself when comparing different business loans:

  • Does the loan offer a fixed or variable interest rate?
    A loan with a variable interest rate charges a rate which fluctuates according to an underlying index throughout the life of a loan, whereas a loan with a fixed interest rate charges the same rate of interest throughout the life of the loan.
  • How flexible is the business loan?
    Consider the degree of flexibility a business loan offers, i.e. does it give you a choice of a fixed or variable interest rate? Secured or unsecured finance? Flexible repayment terms? Some loans offer a split loan facility where one part of the loan is repaid on a fixed interest rate and the other is repaid on a variable one. Another flexibility feature you might want to look for is a switch loan facility which allows you to switch between fixed and variable interest rates.
  • Is the loan size appropriate for my business needs?
    Consider whether the size of the loan offered is suitable for your needs.
  • Is there an option to pay off my loan faster?
    Check whether the business loan allows you to make additional repayments in order to pay off your loan faster and save on interest repayments. Also check if the loan allows you to make lump sum repayments to pay off your loan faster.
  • Does the loan offer a redraw facility?
    Check whether the business loan allows you to withdraw additional repayments.

Is a fixed or variable interest rate better?

Both fixed and variable interest rate loans have their pros and cons, so the answer to this question will depend on your business needs. Keep in mind that loans with variable interest rates will often offer flexible features like fee-free redraw facilities and additional repayments. However, there is the risk of your repayment amounts increasing if interest rates increase, so you will need to plan for this risk. 

On the other hand, fixed interest rate loans usually offer the same flexibility features and give you the certainty of the same repayment amounts. In exchange for providing you with this certainty, they will also charge you a higher rate than variable interest rate loans. 

This is why choosing between a fixed rate or variable rate requires you to budget carefully and decide how much risk you are capable of taking on to meet your business needs. 

Why is it so important to get a good business loan interest rate for small businesses?

For small businesses, having adequate cash flow is key to a well-maintained business. This is why securing a good interest rate for your loan is essential. By securing a low interest rate, you will be left with more working capital to spend on the day-to-day expenses of your business. 

How much does a small business loan cost?

There are three main costs involved when taking out a business loan. The three costs you need to consider when budgeting for a business loan are:

  • Loan amount
    A larger loan amount will mean larger repayments. You may wish to use a business loan repayment calculator to determine how much you can afford to borrow. 
  • Interest rate
    Higher interest rates will mean the cost to repay your loan will be higher. 
  • Other fees and charges
    Always be aware of any upfront or ongoing fees that you will be charged for when taking out a loan e.g. application fees, establishment fees etc. 

How much can I borrow?

The amount you can borrow depends on your credit history and your business financials. Small businesses can generally borrow anywhere from $5,000 to $250,000, and sometimes even up to $1,000,000. 

However, this will all depend on the size of your business, your business turnover and how long your business has been operating. 

What are some mistakes to avoid when choosing a loan? 

When choosing a loan for your business, you should avoid making the following mistakes as they could hinder your chances of securing a loan.

  • Providing insufficient detail in your loan application
  • Not comparing loans 
  • Ignoring fees, charges, interest rates and comparison rates
  • Not exploring other financing options 

Where can I find good business loan rates?

There are generally two types of lenders you will come across when searching for the right business loan rate: banks and non-banks.

Bank lenders
An advantage of taking a loan from a bank is that you’ll always be able to walk into a branch and speak to a manager. You may also have access to greater loan amounts. However, banks often charge higher rates and fees. 

Business loan bank lenders in Australia:

  • ANZ business loans
  • Commonwealth Bank business loans
  • Westpac business loans
  • NAB business loans 

Non-bank lenders
A major advantage of non-bank lenders is the added flexibility they can provide as privately-owned institutions have multiple sources of funding. This means non-bank lender loans usually come with fewer conditions and don’t have to be secured. 

The downside is that customers may not always benefit from rates and interest rates may be more volatile. Also note that non-bank lenders rely on a steady economy to access capital which makes them more vulnerable in times of economic downturn. 

Business loan non-bank lenders in Australia:

  • Prospa
  • Spotcap
  • Moula
  • Ondeck

Explore our latest business loan offers to compare loans and find the right one for your business needs.

Browse and compare our range of business loan offers today, or you can find an experienced business loan broker to assist you.

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