FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The Auckland Small Business Loans
Tell me more about Auckland Small Business Loans
Auckland unsecured loans offers the range of $5,000 to $100,000. Terms range from 3 and 24 month and cash flow-friendly repayments that are either per day or weekly.
How is this Unsecured Loan different from an ordinary business loan?
The application to get the Small Business Loan in under 10 minutes online or over the phone. You’ll get a same day response and the funds could be in your account within 24 hours. Traditional business loans are based on an interest rate per annum as well as other fees and charges. The business loan is an upfront priced loan which means you know in advance the amount you will have to pay, including the interest, fees and charges. This is then divided into weekly or daily repayment figure.
What could be the Small Business Loan be used for?
A Small Business Loan can be used for almost every company purpose including cash flow management, company remodels and marketing, to purchase inventory or new equipment, for general working capital and much more. The loan is not available to fund personal expenses.
About the Larger Auckland Business Loans
What is the Larger Auckland Business Loan?
The Larger Business Loan is a larger size of loan that can be used to fund business growth opportunities. Loans range between $100,000 and $500,000 with a fixed-term for up to 36 months. The repayments are made weekly or fortnightly depending on you cashflow.
How’s the Origination Fee determined?
It is crucial to note that the Larger Business Loan has an Origination Fee, which is calculated at 2.5% of the amount of the loan.
Can I get the Larger Business Loan?
In order to be eligible for a loan in this amount, your company needs to have been operating for at least three years with an annual turnover of at least $700,000. Your business must belong to a New Zealand Citizen (or Permanent Resident) with a minimum age of 18 years old, own a New Zealand business (with a valid NZBN/IRD) and be able of proving at least 12 months of trading.
How can the funds be used for?
A large business loan is a great option for almost all business need, including business renovations, purchase of equipment or inventory for general working capital, and much more. The loan cannot be used for personal purposes.
Is the Larger Business Loan one that requires security?
Asset security is required for accessing funds over $150,000. This can be done by taking a charge on assets and can include the registration of this with the PPSR or making as a caveat.
A personal or director’s ensure is a commitment to repay a loan which is generally in nature rather than defining security over a particular asset. The person signing the guarantee is personally accountable if the business borrower is unable to repay the debt.
The Personal Property Securities Register (PPSR) is an online, central registry run by the New Zealand Government. It reflects security interests granted to individuals who own personal property (including the assets or goods). The PPSR grants the priority of personal property assigned depending on the date that a security interest has been registered.
Caveats are legal document that is filed to provide an official notice of a claim to property.
What is a pre-approval minus Credit Check?
If you’re seeking a Larger Business Loan of $250K or more it is possible to offer a preliminary pre-approval to help smooth out the process. We may be able to do this without a credit verification and within 6 hours of the initial application. The pre-approval process is based on an initial assessment, which involves the answer to a series of financial health questions. It is not an offer of credit or guarantee of finance. Acceptance without condition is subject to an exhaustive credit evaluation, and any offer that you receive could have different terms.
Application process
Are I eligible for funding?
You may apply for a business loan if you
- are a New Zealand Citizen (or Permanent Resident)
- are 18 years or older, have a New Zealand company (with a valid NZBN/IRD)
- can demonstrate at least 6 months’ worth of transactions (for you to qualify for unsecured loan $5K – $100K) or three years of trade (for the Larger Business Loan $100K up to $500K)
How do I apply?
The application process is fast and easy. Simply complete the online form in just a few minutes, and a dedicated company expert in lending will call you to assist you.
For a loan of up to $100,000, you’ll need identification details (valid Driver’s Licence), an active NZBN/IRD, and at least six months of bank statements.
For larger loan sizes, you’ll also require:
$100K-$250K: Application details including credit consent, 6 – 12 months of bank statements, IRD statement (if the loan is greater than $150K).
$250K-$500K: Information on the application including credit consent and 12 months bank statement, an IRD statements as well as the two most recent years’ financial statements, in addition to interim financials for the current financial year, Aged Payables and Aged Receivables Summary.
How quickly will I receive a decision?
For an unsecured loan ($5K or more) we usually provide an answer in just one hour – as long as you make your application in standard company time and allow us to utilise the bank verification system to immediately verify your bank account information online. If you want to upload copies of your bank statements , we will be able to offer the decision in just one company day.
If you are applying for a Larger Business Loan ($100K or more) we may be likely to provide you with conditional pre-approval within about six hours. Once you’ve signed the pre-approval document, you will need to wait around 2-3 days for final approval. However, this may be quicker depending upon the circumstances for each application. Certain deals have been approved within less than 24 hours.
The fastest way is to make sure you apply during normal company hours, and permit us to use the advanced bank verification system to verify your bank account information online. If you decide to upload copies of your bank statement, it can take a bit longer.
What is the time frame to receive the funds?
For the Small Business Loan ($5K to $100K) we typically offer an answer within one hour, provided you apply in normal business times and let us utilise the advanced bank verification system to instantly verify your bank’s information online. If you choose to upload copies of your bank statements, we are able to provide the decision within one business day.
If you are applying for Larger Business Loans ($100K up to $500,000) we could be in a position to offer you with a conditional pre-approval in about six hours. After you’ve signed the pre-approval, turnaround times are between 2 and 3 days for the final approval. However, this may be quicker depending on the specifics of each application. Some offers have been approved in less than 24 hours.
The fastest method for you to apply is make sure you apply during normal business hours, and permit us to use the modern bank verification to verify your bank account information online. If you upload duplicates of your banking statements it will take a little longer.
How much can I borrow?
We provide loans that range from $5,000 to $500,000. When you make an application for a certain amount we look at a variety of elements in order to assess your health that is your company and the level of the repayments your company can afford. The total amount of your loan will be contingent on the specifics that are unique to your business.
When you apply for a specific amount we will consider a number of factors to assess your well-being of the business and the level of repayments that your company is able to afford. The amount you receive from your loan will depend on the specific circumstances that are unique to your business.
Fees & repayments
How much should you charge for a company loan?
If you decide to apply for business loans with us business loan, we’ll assess the risk profile the business and provide an individualised offer including the amount of the loan, the duration and interest rates. The company loan is a loan that is priced upfront which means you know in advance the total amount to be paid, including any costs, fees, or interest rates.
What determines the amount I pay?
Business loan interest rates differ based on various factors such as the amount that is borrowed, the company assets the funds are used to purchase and the sector the business operates in, the long the business has been in operation for, what percentage of the business has enough cash flow to support the loan, as well as the general well-being or financial standing of the company.
What are the fees?
There aren’t any hidden costs with our company loans. You’ll know precisely how much you’ll need to pay, and when, from the day you sign up. There’s no compounding and the loan comes with no additional fees (as long as you are able to make your payments punctually).
We do not charge an application fee. You can make an application for loans no cost upfront or the obligation to take action.
The Origination Fee covers the costs associated in establishing and managing the loan. This is only a fee if you decide to take the loan. The Origination Fee for us is 2.5% of the amount of the loan.
Can I repay the loan earlier?
You can choose to repay the entire amount of the loan at any point in time.
If you choose to take this route, please talk to one of our helpful company lending experts. The experts will provide you with the details of your repayment and an early payout figure. It will be calculated using the total of the remaining principal amount and accrued interest to the time of early payout plus 1.5 percent of the principal remaining and any outstanding fees.
How do you make repayments work?
To help you avoid missing repayments and to fit in with your cash flow cycle we offer repayments that are either weekly or daily. They are automatically deducted from your company account.
Security & privacy
Will my data be secure?
Security of your data, and being transparent about the ways we gather data, process, exchange and secure your information, is of huge importance and a vital part of our relationship 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 information and our funders are ISO 27001 certified for our dedication to customer security and security. We use an advanced bank verification system to immediately confirm your bank account information online to offer rapid response.
About business loans
What’s an asset-based borrow (a secured loan)?
Asset-based borrowing occurs when the business owner borrows from the assets they have to get the funding. The asset may be an asset belonging to the personal, like the family home or an business asset like a truck or other piece of machinery.
The majority of the lenders not just the banks with the biggest size, prefer to guarantee loans against an asset. If you are having difficulty paying back the loan then your assets could be offered for sale by the lender. In essence it is the process of securing new funding using the value of what you already have.
What do I require security for a company loan?
Up to $150,000 in loans it is not necessary to secure assets prior to the loan’s access, however we do require a personal guarantee. If you adhere to the loan terms (as stipulated in your loan contract) and you are able to meet your obligations, asset security will never be required. For loans that exceed $150,000, typically, you will need the option of a personal ensure and security that is in the form an asset charge.