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Fast Business Loans – Your Guide to Quick Business Finance

Women on laptop computer learning about fast business loans

Getting fast business loans might seem like an impossible task for small business owners. If you need a fast business loan and want to know the time frames of the options available, you’ve come to the right place. In this article, we’ll look at the time frames of common business loan finance options, from slowest to quickest to help you decide what’s right for you if you are looking for fast business finance.

Not a fast business loan. Traditional bank business loans can take up to two months to get approved

Taking up to two months to get, if approved, this type of loan is at the bottom of the list when ranking fast business loans. These types of business loans are common with Australia’s big four banks – ANZ, Commonwealth Bank, NAB and Westpac. In addition, these are mostly for larger loans with a minimum loan amount of $50,000. A traditional business loan from a bank is good when you need a substantial sum of money to be paid off over a period of up to 10 years. But this won’t apply to many Australian businesses. It’s usually used for purchasing assets such as real estate or a competing business.

Pros of a traditional business loan:

  • Relatively low interest rates — around 8% on average — depending on the type of assets used for securing the loan.
  • Longer period to pay off the loan that can be up to 30 years.
  • Depending on the bank, you can choose between fixed or variable rates, or a combination of both.
  • Flexible repayments in some cases – monthly, quarterly, half yearly or annual repayment cycles.

Cons of a traditional bank business loan:

  • Requires business to be established for several years with a proven track record and credit history to be approved for a loan. Not an option if you have bad credit. 
  • Substantial paperwork and scrutiny for the loan application.
  • Approval can take up to two months, so it’s not a fast business loan.
  • Higher minimum lending amounts make it out of reach for many small businesses.

Hire Purchase — one to two weeks

This type of loan is offered by traditional bank lenders and usually takes up to two weeks for approval for the purchase of vehicles, machinery or equipment, typically for periods from 1 to 5 years. For example, if you are buying a vehicle for your business, you’ll make monthly payments for the agreed period. When all payments have been made, the bank transfers the title to you. Sometimes a hire purchase loan includes the option to make a balloon payment at the end. This is a larger payment that will decrease the size of your monthly payments.

Pros of hire purchase

  • You can select a term and payments to meet your cash flow and useful life of the asset.
  • It might be possible to claim input tax credits for the GST payable on interest and fees included in the price of the hire purchase.
  • After all payments have been made, you take the title of the asset and decide whether you will continue to use it or sell it.

Cons of hire purchase

  • The bank owns the asset until all payments have been made.
  • The interest rate is usually higher than a traditional bank loan.
  • With a one- to two-week approval process, it’s lower on the list of fast business loans.

Personal Loan — five to seven days

Although not recommended, sometimes business owners will take out a personal loan for business purposes. This type of loan is usually easier to get than a traditional business loan. Unlike hire purchase finance, you can buy anything once you have the personal loan. With approval taking around one week, it’s not at the top of the fast business loans list. It can be used to borrow smaller amounts (up to $50,000) and the term can be between one and seven years.

Pros of personal loans

  • Can be obtained relatively quickly.
  • Available as secured or unsecured, with fixed or variable interest rates.
  • Instalments make it possible to spread payments when purchasing a large asset for the business.

Cons of personal loans

  • The interest rate for a personal loan will be higher than for a business loan – between 8% and 20%.
  • Approval and the amount you can get will be based on your personal credit rating.
  • You are personally responsible for making repayments and your personal assets are at risk if you are not able to pay.

Business Credit Card — 2 to 7 business days for fast business finance

With an approval period of between two to seven days, business credit cards fall into the fast business finance category. With a business credit card, you have the flexibility to spend the funds on whatever you want. You also have flexibility with payments if you pay the minimum amount required each month.

Pros of business credit cards

  • They’re flexible and easy to use.
  • With some cards offering an interest-free period on purchases (up to 55 days), so it can be a cost-effective way to make purchases if you repay within the interest-free periods.
  • Some business credit cards offer points, travel insurance and other incentives.

Cons of business credit cards

  • Higher interest rates — between 12% and 24% — than other forms of business finance
  • Most business credit cards have annual fees.
  • Your business credit card might be tied to your personal assets, so they could be at risk if you are not able to make repayments.

Get tips for choosing the right business credit card.

Buy now, pay later for business – an alternative to fast business loans

This is becoming a popular form of business finance in Australia. With buy now, pay later finance, you pay the balance offer over an agreed timeframe. With Moula Pay, for example, you can purchase goods and services from a participating merchant. Then you get up to three months free from interest and repayments, or you can take a longer-term repayment plan if needed.

Find out more in Buy Now, Pay Later for Business: What Are the Benefits?

Bank Overdraft — one to two days

Pros of a business overdraft

  • It’s relatively quick and easy to get if you have a few years’ in business and a good credit history.
  • Flexibility – you only use, and pay interest on, what you need.
  • You are only charged for the amount you use of your business overdraft.
  • Can be secured and unsecured.

Cons of a business overdraft

  • Higher interest rate than traditional bank business loan – between 8% and 12%.
  • Can be called at any time for immediate repayment.
  • Usually requires an establishment fee and ongoing fees.

Learn more about this type of finance in What’s a Business Overdraft?

Online Unsecured Business Loans — fast business loans in as little as one day

An unsecured small business loan is at the top of the list for fast business loans as it is usually approved within 24 hours. Companies providing short-term online business loans use advanced technology to make it easy to apply for a loan. Instead of completing stacks of paperwork, you provide access to your banking and/or accounting data. Your information is analysed to determine whether you are eligible for a loan. Lenders offering online unsecured business loans also will review your credit report.

Pros of online unsecured business loans

  • Quick and easy loan application process.
  • Fast response in determining approval.
  • Quick access to funds if approved.
  • Easier eligibility requirements for small and new businesses that don’t meet banks’ lending requirements.

Cons of online unsecured business loans

  • Higher interest rates than a traditional bank loan due to higher risk for the lender.
  • Loan terms are usually shorter – usually less than three years.
  • A personal guarantee may be required from the borrower, depending on the business structure.

Learn more about unsecured business loans.

When looking for fast business loans, be sure you read the fine print, including the loan terms and conditions, before deciding. Some unsecured small business loans include additional fees that you will want to look for when considering fast business finance options. 

Fortunately, there’s now a way to easily compare business loans. It’s called SMART Box™ and is the result of a group of online business lenders coming together and agreeing to a Code of Lending Practice. Find out more in What Is SMART Box™ and How Does It Help Small Business Owners?

To get an estimate of principal, interest and repayments for an unsecured business loan, check out our business loan calculator. 

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