FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
About The Paremata Small Business Loans
Let me know how you are able to avail the Paremata Small Business Loans
Paremata unsecured loans offers amounts of between $5,000 and $100,000, with terms ranging from 3 and 24 month and cash flow friendly repayments that are either daily or weekly.
What is the Unsecured Loan different from the traditional business loan?
You can apply for this Small Business Loan in under 10 minutes via the internet or by phone. You will receive an immediate response, and have the funds on your account within 24 hours. Traditional business loans have an interest rate per annum as well as other fees and charges. Our company loan is a cash-based loan and you’ll know in advance the amount you will have to pay, including any fees, interest or charges. Then, it is divided into weekly or daily payment amount.
What can you use the Small Business Loan be used for?
The Small Business Loan can be used to fulfill almost any business need, such as cash flow management, company renovations, marketing to purchase inventory, new equipment, to fund general working capital and so much more. The loan is not available for personal use.
Concerning Larger Paremata Business Loans
What is the Larger Paremata Business Loan?
The Larger Business Loan is a larger size loan to aid in business expansion opportunities. The loan ranges from $100,000 to $500,000 with a fixed-term up to 36 months. Repayments are scheduled weekly or fortnightly to work with you cashflow.
How’s the Origination Fee determined?
This Larger Business Loan has an Origination Fee, determined at 2.5 percent of the amount of the loan.
Am I eligible for the Larger Business Loan?
In order to be eligible for a loan in this amount, your business needs to have been in operation for at least 3 years, and have an annual income of $700,000. Your company must belong to a New Zealand Citizen (or Permanent Resident) with a minimum age of 18 years old and have a New Zealand company (with a valid NZBN/IRD) and be able demonstrate at minimum 12 months of business.
How can the funding be utilised?
A Business Loan of a larger size can be used for nearly every company purpose including company remodeling, buying equipment or inventory or as general working capital, and much more. The loan cannot be used for personal use.
Is the Larger Business Loan a secured loan?
Asset security is necessary to access funding over $150,000. It’s by way of charge against assets and can include registration in the PPSR or the registration of a caveat.
A director’s or personal guarantee is a commitment to pay back a loan that is generally based rather than stipulating security over a particular asset. The person signing the ensure is personally liable if the company the borrower fails to make the repayment.
The Personal Property Securities Register (PPSR) is an online central register that is operated by the New Zealand Government. It records security interests that have been which are registered with respect to personal property (including goods or assets). The PPSR gives priority over personal property to be granted according to the date the security interest was registered.
A caveat is a legal document filed to offer the public notice of a legal claim to property.
What is a pre-approval without Credit Check?
If you’re applying for a Larger Business Loan of more than $250,000, we may offer a preliminary pre-approval to help ease the process. We could be able to do this without a credit check and within 6 hours of your initial application. This pre-approval is based on a preliminary assessment which includes the answer to a series of financial well-being questions. This is neither an offer nor a guarantee of finance. The approval of a conditional loan is subject to an exhaustive credit evaluation, and any offer that you are offered could have different terms.
Application process
Do I qualify for funds?
You can apply for a company loan if you;
- are a New Zealand Citizen (or Permanent Resident)
- are at least 18 years old, own a New Zealand company (with a valid NZBN/IRD)
- you must prove at least 6 months of trading (for you to qualify for unsecured loan $5K – $100K) or 3 years of continuous trading (for the Larger Business Loan $100K up to $500K)
How do I apply?
The application process is fast and simple. Just complete the online application in few minutes and an experienced business loan specialist will contact you to guide you through the process.
To be eligible for up to $100,000, you’ll need ID details (valid Driver’s License) as well as an NZBN/IRD that is valid and at least 6 months’ worth of bank statements.
If you’re looking for loans with larger sizes, you’ll require:
$100K-$250K: Application details including credit consent, 6-12 months of IRD statements, bank statements (if the loan is greater than $150K).
$250K to $500K: Details of the application, including credit consent twelve months bank statement, an IRD statements Last 2 years’ finalised financial statements, as well as interim financial statements for the current year such as age-related payables and aged Receivables summaries.
How fast will I get a decision?
For an unsecured loan ($5K up to $100,000) We can usually offer a response in one hour – as long as you make your application within quality company timings and you allow us to utilise the advanced bank verification system to immediately verify your bank account information online. If you want to upload copies of your banking statements we can offer an answer in as little as 1 business day.
For the Larger Business Loan ($100K up to $500,000) we might be capable of provide the conditional pre-approval in around six hours. After you’ve signed your pre-approval form, it will take approximately 2-3 days to receive final approval. However, this could be shorter based upon the circumstances for each application. Certain transactions have received approval in just 24 hours.
The fastest way can be ensure you apply during normal business hours, and allow us to use the advanced bank verification system to check your bank’s information online. If you decide to upload documents from your account statements , it takes a bit longer.
How quickly will I receive the cash?
For the Small Business Loan ($5K and up) we can often provide a response in one hour – provided you make your application within normal business times and you allow us to use the advanced bank verification system to immediately verify your bank account information online. If you want to upload copies of your bank statements, we’ll be able to offer an answer in as little as one business day.
For Larger Business Loans ($100K to $500K) we may be able to offer you with conditional pre-approval within about 6 hours. Once you have signed the pre-approval form, it will take around 2-3 days for final approval. However, it could be faster based on the specifics of each application. Certain agreements have been approved in just 24 hours.
The fastest method is to make sure you apply during normal business hours. You can also allow us to use our advance bank verification link to instantly verify your bank information online. If you send us the copies of bank accounts, it may take a bit longer.
What’s the minimum amount I can borrow?
We offer loans ranging from $5,000 and $500,000. When you make an application for a particular amount, we consider a variety of factors that determine how much we can lend you health for your company and the level of payments your business can support. The total amount of your loan will depend on the specifics for your company.
When you make an application for a certain amount, we take into consideration a variety of variables to determine how much we can lend you such as well-being of the company and the amount of payments your business can afford. The total amount of your loan will be determined by the particulars of your business.
Fees & repayments
How much should you charge for an company loan?
If you decide to apply for one of our company credit, we will assess the risk assessment the company and provide you with a customised proposal that includes the amount of loan, the term and interest rates. This business loan is an upfront cost loan so you will be aware in advance of the total amount to be paid, including any charges or interest.
What determines the rate that I will be charged?
The interest rates on company loans rates vary due to factors such as the amount that is that is borrowed, what company assets the money are used to purchase, the industry the company operates in, the long the business has been in operation for, what percentage of the company has sufficient cash flow to fund the loan, and the overall well-being and creditworthiness of the company.
What are the costs?
There are no hidden costs for our company loans. You’ll know precisely how much it is that you need to pay, and when, from the day you sign up. There’s not any compounding interest and the loan comes with no additional fees (as as long as you pay your payments on time).
We do not charge an Application Fee. You are able to request a credit loan with no cost upfront or commitment to apply.
The Origination Fee covers the costs associated with setting up and managing the loan. You are only charged this fee if you decide to take the loan. Our Origination Fee is 2.5 percent of the amount of the loan.
Can I pay off the loan early?
You can repay all of your loan early at any time.
If you do decide to do this please call our helpful business loans professionals. They will provide you with the details of your repayment as well as an early payout amount. The figure will be calculated as the total of the principal balance plus any accrued interest as of the date of early payout in addition to 1.5 percent of the remaining principal and any fees that remain unpaid.
What is the process for repayments?
In order to help you avoid missing due dates and also to be in line your cash flow schedule, we provide repayments either daily or weekly. These are automatically deducted from your nominated business account.
Security & privacy
Will my data be protected?
The security of your personal information, as well as being upfront about the ways we gather, use, 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 standards to protect your personal, sensitive financial and other data. Our funders are ISO 27001 certified for our commitment to the security of our clients as well as their privacy. We utilise a sophisticated banking verification system to instantly verify your bank account details online, allowing us to offer a fast response.
About business loans
What’s an asset-based borrow (a secured loan)?
Asset-based borrowing is when a company owner uses an asset they own to make a loan. The asset may be an asset belonging to the personal, like the family home, or a business asset such as a vehicle as well as a piece of machine.
The vast majority of lenders, not just the largest banks, are inclined to make loans secured by assets. If you’re struggling to pay back the loan then the asset could be taken over by the lender. In essence it is means of securing additional financing taking advantage of the value of what you already own.
What do I need security to get an business loan?
For loans of up to $150,000, no asset security is required upfront to access the money but we do require a personal guarantee. If you adhere to your loan obligations (as detailed in the loan contract), asset security is not needed. For loans of over $150,000 typically, you will need an individual guarantee and security is provided in the form of the charge of assets.