FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the New Zealand Small Business Loans
Let me know about the New Zealand Small Business Loans
New Zealand unsecured loans provides amounts of between $5,000 and $100,000. Terms range from 3 and 24 months, cash flow friendly repayments that are either per day or weekly.
How is what makes the Unsecured Loan different from an traditional business loan?
You can apply for the Small Business Loan in under 10 minutes via the internet or over the phone, receive an answer within the same day and the funds could be available in just 24 hours. Traditional company loans reference an interest rate per annum as well as other fees and charges. The business loan is a cash-based loan which means you be aware in advance of the amount you will have to pay, including any fees, interest or charges. This is then broken down into a daily or weekly amount to be paid back.
What can you use the Small Business Loan be used for?
The Small Business Loan can be used to fulfill almost any company need, such as cash flow management, company renovations, marketing to purchase inventory, new equipment, or as general working capital and so much more. The loan cannot be used to fund personal expenses.
About larger New Zealand Business Loans
What is the Larger New Zealand Business Loan?
The Larger Business Loan is a larger size loan to aid in company growth opportunities. Loans range from $100,000 to $500,000 over a fixed term up to 36 months. Repayments are either weekly or fortnightly, depending on the flow of cash.
How is the Origination Fee calculated?
This Larger Business Loan has an Origination Fee which is determined at 2.5% of the loan amount.
Do I qualify for the Larger Business Loan?
To qualify for a loan in this amount the business needs to have been in operation for at least 3 years, and have an annual income of $700,000. Your business must belong to a New Zealand Citizen (or Permanent Resident) with a minimum age of 18 years old or have a New Zealand business (with a valid NZBN/IRD) and be able to prove at the least 12 months of operating.
What can I use the funds for?
A Business Loan of a larger size can be used to fund almost every business need, including company renovations, purchase of equipment or inventory or as general working capital, and much more. The loan is not available for personal use.
Is the Larger Business Loan one that requires security?
Asset security is necessary for funding of more than $150,000. It is usually as a result of an charge over assets, and could include the registration of this on the PPSR or registering a caveat.
A personal or director’s guarantee is a commitment to pay off a credit line that is generally in nature rather than specifying the security for a particular asset. The person who signs the guarantee is personally responsible if the company lender is not able to make the repayment.
The Personal Property Securities Register (PPSR) is an online, central register that is operated by the New Zealand Government. It reflects security interests which are registered with respect to personal property (including goods or assets). The PPSR gives preference over private property assigned according to the date the registration of a security interest.
The caveat can be described as a formal document that is filed to provide notice of a legal claim against a property.
What is a pre-approval that does not require Credit Check?
When you’re applying for the Larger Business Loan that is greater than $250K we can offer an initial pre-approval to make the process. We could be able to apply for this without credit checks and within 6 hours of the initial application. The pre-approval process is based on an initial assessment that includes the answer to a series of financial health checks. It is neither an offer nor a guarantee of financing. Unconditional approval is subject to an exhaustive credit evaluation, and any offer you may receive may be subject to different conditions.
Application process
Are I eligible for funding?
You may be eligible for a business loan if you;
- are a New Zealand Citizen (or Permanent Resident)
- are at least 18 years old, have a New Zealand business (with a valid NZBN/IRD)
- can demonstrate at least 6 months of trading (for a unsecured loan $5K – $100K) or 3 years of trading (for the Larger Business Loan $100K or $500K)
How do I apply?
The application process is simple and simple. Complete the online form in few minutes and a dedicated company credit specialist will be in touch to guide you through the process.
To be eligible for up to $100,000, you’ll need identification details (valid Driver’s Licence), a valid NZBN/IRD as well as at least six months of bank statements.
If you’re looking for loans with larger sizes, you’ll require:
$100K – $250K: Details of application, including credit approval, 6-12 months of bank statements, IRD statement (if you have a loan of more than $150K).
$250K – $500K: Information on the application including credit consent, 12 months bank statement, an IRD statements, last 2 years finalised financial statements, and interim financial statements for the current year such as age-related payables and aged Receivables Summary.
How fast will I get an answer?
For an unsecured loan ($5K and up) We can usually offer an answer within an hour – as long as you make your application during quality business timings and let us utilise the advanced bank verification system to immediately verify your bank account information online. If you want to upload copies of your bank statements , we are able to provide an answer in just 1 business day.
For Larger Business Loans ($100K and up) we might be able to provide you with a conditional pre-approval in about six hours. After you’ve signed the pre-approval document, you will need to wait approximately 2-3 days to receive final approval. However, this may be quicker depending upon the circumstances for each application. Certain agreements have been approved in the space of 24 hours.
The quickest method would be to ensure you apply during standard business hours, and permit us to use the advance bank verification to instantly verify your bank account information online. If you choose to send us duplicates of your banking statement, it may take a bit longer.
How quickly will I receive the cash?
For the Small Business Loan ($5K or more) we typically provide an answer within an hour – provided you submit your request during normal business hours and let us make use of the advanced bank verification system to instantly verify your bank details online. If you opt to upload copies of your banking statements we can provide an answer in as little as 1 business day.
For Larger Business Loans ($100K or more) We may be likely to offer you with pre-approval conditional to your application in about 6 hours. Once you’ve signed your pre-approval document, you will need to wait approximately 2-3 days to receive final approval. However, it could be faster based upon the circumstances for each application. Some transactions have received approval in just 24 hours.
The most efficient method for you to apply is ensure you apply during normal business hours, and let us use the advance bank verification to instantly verify your bank information online. If you send us documents from your account statements, it can take a bit longer.
What is the maximum amount I can borrow?
We offer the loan amount between $5,000 and $500,000. When you submit an application for a certain amount we will consider a number of elements to determine the health that is your business and the extent of repayments that your business can afford. The total amount of your loan will be contingent on the particular circumstances for your business.
If you apply for a set amount, we take into consideration a variety of factors to determine how much we can lend you such as well-being of the company as well as the amount of payments your business can afford. The amount you receive from your loan will be determined by the particular circumstances the business.
Fees & repayments
What is the cost for the cost of a company loan?
When you make an application for business loans with us business credit, we’ll assess the risk profile of your company and offer you with a tailored offer including the loan amount, the terms and the interest rates. This company loan is an upfront priced loan so you will be aware in advance of the total amount to be paid, including any charges, interest rates or fees.
What determines the amount I pay?
Interest rates for company loans rates vary due to factors like the amount of money borrowed, the business assets the funds are used to purchase in addition to the industry that the business is operating in, how long the business has been in operation as well as in the event that the business has sufficient cash flow to pay for the loan, as well as the general health as well as creditworthiness business.
What are the fees?
There are no hidden costs with our company loans, and you’ll know precisely how much you be required to pay and at what time, from day one. There’s not any compounding interest and there are no additional charges (as as long as you pay your payments in time).
We don’t charge an Application Fee. You can request a credit loan without any upfront costs or the obligation to take action.
The Origination Fee is the cost associated with establishing and managing the loan. This is only a fee if you decide to take the loan. Our Origination Fee is 2.5 percent of the amount of the loan.
Can I pay out the loan earlier?
You may choose to pay back the total amount of your loan in full at any time.
If you are deciding to take this route, please contact our helpful business loans experts. They will provide you with details for repayment along with an early payout estimate. This will be calculated as the sum of the principal amount remaining and any accrued interest at the time of the early payout plus 1.5% of the principal amount remaining plus any outstanding fees.
What are the repayment methods?
To ensure that you don’t miss due dates and also to be in line with your cash flow routine, we offer repayments that are either weekly or daily. They are automatically deducted from your nominated business account.
Security & privacy
Will my information be protected?
The security of your personal information, as well as being clear about the ways we gather data, process, exchange and secure your information, is of huge importance and an integral element of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We use industry recognised encryption standards to secure your personal, sensitive financial and other data. Our funders are ISO 27001 certified for our dedication to protecting the security of clients and privacy. We utilise a sophisticated bank verification system that allows you to instantly confirm your bank account information online, allowing us to offer rapid response.
About business loans
What’s an asset-based borrow (a secured loan)?
An asset-based loan is when a company owner uses an asset that they own to get a loan. The asset may be an asset belonging to the personal, like the family home or it could be a company asset such as a vehicle or piece of equipment.
The majority of banks, not just the banks with the biggest size, prefer to secure loans against an asset. If you’re struggling to pay back the loan, then your asset may be taken over by the lender. In essence it is an opportunity to secure additional financing taking advantage of the value of what you already have.
Do I require security for a company loan?
For loans that exceed $150,000, the requirement for asset security is not required prior to the loan’s access However, we require a personal guarantee. require a personal guarantee. In the event that you fulfill your loan obligations (as detailed in your loan contract document) and you are able to meet your obligations, asset security is not required. For loans that exceed $150,000, typically, you will need a personal ensure and security that is in the form the charge of assets.
