FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The New Zealand Small Business Loans
Tell me more about New Zealand Small Business Loans
New Zealand unsecured loans provides amounts of between $5,000 and $100,000 with terms between 3 and 24 month and cash flow friendly repayments that are either daily or weekly.
How is this Unsecured Loan different from a traditional business loan?
The application for this Small Business Loan in under 10 minutes online or over the phone, receive a same day response and the money could be in your account in 24 hours. Traditional company loans reference an annual rate of interest as well as other fees and charges. The company loan is a cash-based loan so you will know in advance the total amount due, which includes the interest, fees and charges. This is then broken down into a daily or weekly repayment figure.
What could be the Small Business Loan be used for?
The Small Business Loan can be used for virtually any company reason, such as the management of cash flow, business renovations, marketing, to purchase inventory or new equipment, or as general working capital, and much more. The loan is not available 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 business growth opportunities. Loans range from $100,000 to $500,000 over a fixed term up to 36 months. The repayments are made weekly or fortnightly in order to accommodate your cash flow.
How is the Origination Fee calculated?
It is important to note that the Larger Business Loan has an Origination Fee, calculated at 2.5 percentage of the loan amount.
Do I qualify for the Larger Business Loan?
To be eligible for a credit in this amount, your company needs to be trading for at least 3 years with an annual turnover of at least $700K. You must be a New Zealand Citizen (or Permanent Resident) who is over the age of 18 as well as own a New Zealand business (with a valid NZBN/IRD) and be able to prove at least 12 months of trading.
What can I use the funds for?
A larger company loan can be used for almost every company need, including company improvements, purchasing new 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 is secured?
Asset security is required for accessing funds over $150,000. This is by way of charge over assets and can be registered through the PPSR or registering a caveat.
A personal or director’s ensure is a promise to pay back a loan that is generally based rather than specifying security over an asset. The person who is signing the guarantee is personally accountable if the company creditor is unable to repay the debt.
The Personal Property Securities Register (PPSR) is a central, national online registry run by the New Zealand Government. It reflects security interests registered in respect of personal property (including the assets or goods). The PPSR permits the priority of personal property granted depending on the date that a security interest that is registered.
The caveat can be described as a formal form of document to offer the legal claim to a property.
What is a pre-approval that does not require Credit Check?
If you’re seeking a Larger Business Loan of $250K or more, we may offer an initial pre-approval that will help ease the process. We may be able to do this without a credit verification and within 6 hours of the initial application. This pre-approval is based on an initial evaluation that involves the answer to a series of financial well-being questions. It’s not an offer or guarantee of finance. A conditional approval is subject an extensive credit evaluation and any offer you might receive could have different conditions.
The application process
Can I be eligible for funding?
You are eligible to apply for an business loan if you
- are a New Zealand Citizen (or Permanent Resident)
- are over the age of 18 and own a New Zealand company (with a valid NZBN/IRD)
- must show at least six months’ worth of transactions (for a unsecured loan $5K – $100K) or 3 years of trading (for the Larger Business Loan $100K up to $500K)
How do I apply?
The application process is fast and simple. Complete the online form within a couple minutes, and a dedicated business lending specialist will call you to help you.
To apply for up $100,000, you’ll need identification details (valid Driver’s License), a valid NZBN/IRD and at least 6 months of bank statements.
If you’re looking for loans with larger sizes, you’ll need:
$100K to $250K: Application details including credit consent, 6 – 12 months of bank statements, IRD statement (if loan above $150K).
$250K – $500K: Details for application including credit consent and 12 months bank statement, an IRD statements and the last two years’ finalised financial statements, as well as interim financials for the current financial year such as age-related payables and aged Receivables Summary.
How fast will I get an answer?
For an unsecured loan ($5K to $100K) we usually offer an answer within an hour – as long as you apply within quality company times and you allow us to utilise the advanced bank verification system link to immediately verify your bank account information online. If you opt to send us copies of your bank statement, we’ll offer an answer in as little as 1 company day.
For the Larger Business Loan ($100K or more) we might be likely to offer you with pre-approval conditional to your application within 6 hours. After you’ve signed your pre-approval, turnaround times are between 2 and 3 days for the final approval, however this could be shorter based on the specifics of each application. Certain agreements have been approved in just 24 hours.
The quickest way to apply is to ensure you apply during normal business hours and allow us to use the modern bank verification to instantly confirm your bank details online. If you decide to upload documents from your account accounts, it may take a bit longer.
How soon will I receive the cash?
For the Small Business Loan ($5K or more) we usually offer an answer within one hour, provided you apply in normal business hours and allow us to use the advanced bank verification system to instantly verify your bank information online. If you want to upload copies of your bank statements, we are able to provide an answer within one business day.
For the Larger Business Loans ($100K to $500K) we might be capable of offer you with a conditional pre-approval in around six hours. Once you have signed the pre-approval, turnaround times are approximately 2-3 days to receive final approval, however this can be faster depending upon the circumstances for each application. Certain transactions have received approval in just 24 hours.
The quickest method can be ensure you apply during normal business hours and let us use the modern bank verification link to instantly check your bank’s information online. If you upload documents from your account statements, it can take a bit longer.
How much can I borrow?
We offer loans ranging from $5,000 and $500,000. If you apply for a specific amount we consider a variety of elements for determining the health of your company as well as the amount of the repayments your company can afford. The amount you receive from your loan will depend on the specifics of your company.
When you submit an application for a certain amount, we take into consideration a variety of factors to assess your well-being of your company and the level of repayments your business is able to afford. The amount you receive from your loan will be determined by the particular circumstances that are unique to your company.
Fees & repayments
What is the cost for an company loan?
When you make an application for one of our company loan, we’ll assess the risk profile for your business and provide you with a customised proposal that includes loan amount, term and the interest rates. The business loan is a loan that is priced upfront therefore you will know in advance the total amount due, which includes any charges, interest rates or fees.
What is the factor that determines the price I pay?
Interest rates for business loans rates depend on a variety of factors including the amount that is borrowed, what company assets the money are used to purchase, the industry the business operates in, how long the business has been running and how long the company has sufficient cash flow to pay for the loan, as well as the general well-being or creditworthiness of the company.
What are the fees?
There aren’t any hidden charges with our company loans. You’ll know precisely what you be required to pay and at what time, from the day you sign up. There’s no compounding and there are no additional charges (as long as you make your payments in time).
We do not charge an application fee. You can request a credit loan with with no upfront cost or any obligation to sign up.
The Origination Fee is the cost associated with establishing and managing the loan. It is only charged for this fee if you choose to proceed with the loan. The Origination Fee for us is 2.5 percent of the loan amount.
Can I pay off the loan earlier?
You can decide to repay the entire amount of your loan in full at any time.
If you do decide to pursue this option, please contact our helpful company credit specialists. They’ll offer you with details for repayment and an early payout figure. It will be calculated using the total of the principal balance and the accrued interest up to the time of the early payout, plus 1.5 percent of the remaining principal and any outstanding fees.
What are the repayment methods?
In order to help you avoid missing due dates and also to be in line with your cash flow cycle we offer repayments that are either daily or weekly. These are automatically withdrawn from your designated company account.
Security & privacy
Will my data be protected?
Protecting your information, and being transparent about how we collect data, process, exchange and secure your information, is of huge importance and a vital part of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We employ industry-recognised encryption protocols to safeguard your sensitive, personal financial and other data. Our funders are ISO 27001 qualified for our commitment to protecting the security of clients and privacy. We utilise a sophisticated bank verification system link to instantly confirm your bank account information online so we can provide a fast response.
About business loans
What exactly is an asset-based loan (a secured loan)?
Asset-based borrowing is when a company owner makes use of assets they own to obtain the funds for a loan. The asset can be an individual property, such as the family home or a business asset such as a vehicle as well as a piece of machine.
The majority of banks, not just the major banks, prefer to make loans secured by an asset. If you are having difficulty paying back the loan, the asset could be taken over by the lender. In essence it is the process of securing new financing using the value of what you already have.
Do I require security for an business loan?
Up to $150,000 in loans no asset security is required in advance to gain access to the funds, however we do require a personal guarantee. In the event that you fulfill your loan obligations (as stipulated in your loan contract document) and you are able to meet your obligations, asset security is not needed. For loans over $150,000 generally, you can get a personal ensure and security in the form the charge of assets.