How to Get a Small Business Loan

Read through the step-by-step process of applying for your business loan and how to maximise your approval chances with Savvy.

Last updated on June 17th, 2022 at 03:16 pm by Thomas Perrotta

How to get a small business loan

Loans help small businesses access the funds they need to cover a multitude of expenses and pay them off at their own speed. However, it’s important to understand how to give your business the best chance of loan approval. Read about getting your application approved and compare your options here with Savvy. 

How do I get a loan for my small business?

There are several key steps involved in the process of how to get business funding in Australia, so it’s important to understand what you’ll need to do to secure the finance deal you’re looking for. You should look to meet the following points along the way when considering what loan to get:

Consider the purpose of your loan

First and foremost, you should understand the purpose of your loan as a small business owner. How much do you need? What do you need the money for? How great is your need for financial assistance? It’s important to ask yourself these questions before plunging into your application, as taking on a loan is a big commitment. It can be helpful to put together a plan of exactly what needs to be covered so you can map out the costs required, as this reduces the chances of borrowing more than you need and paying a considerable amount more overall. Make sure you know whether it’s a small cash advance you need or a larger loan repaid over a longer term.

Its purpose may also impact the type of loan you end up taking out. For instance, if you’re only looking for a $10,000 injection for cashflow, a basic unsecured small business loan is likely to do the trick. If you’re renovating your business premises and would prefer to take out money as you need it to pay your builders, you may prefer a line of credit with a higher limit.

Compare your small business loan options

Of course, it’s important to compare as many options as you can before taking the plunge with one particular lender. You can do this here with Savvy, as we break down offers from our lending partners so you can analyse all the areas that matter the most to you. Are you looking for offers with the lowest interest rates? Maybe you’re wanting a loan with a particular available loan term, a high maximum borrowing range or features such as free early repayments. You can consider the key points of each loan deal all in one place.

Review lender requirements

Of course, there’s little point in wasting time with a business loan if you don’t meet the eligibility requirements of the lenders you’re considering. Although the specifics will differ between different lenders, the main points male, non-binary or female operators looking for finance will be required to meet as part of your application are:

  • A minimum trading period of six months
  • A minimum monthly turnover of $5,000
  • You must be 18 years or older
  • You must be an Australian citizen or permanent resident
  • You must have a valid ABN or ACN

Think about the fees you may be charged

There are several different fees which you’ll need to consider when choosing your business loan. They’re likely to differ between lenders, with some able to waive certain charges what others don’t, so carefully analysing what these are will help you save overall. The primary fees to look for are establishment and ongoing costs, both of which can be as little as $0. Additionally, some lenders will charge a fee for paying off your loan early, which can be dependent on the size of the loan and the time left to run on it.

Gather the documents you need

Next, you’ll need to gather the documentation required for your loan application. These will include:

  • Your ABN/ACN and GST registration
  • Personal identification such as your driver’s licence or passport
  • Access to online bank statements
  • Expenses such as rent

If your loan is larger (usually above $250,000), you may also need:

  • Profit and loss statements
  • Balance sheets
  • ATO Integrated Client Account information
  • Accounts receivable and payable
  • Tax returns
  • A detailed business plan

Submit your application

From there, you have all the information and documents you need to go ahead and apply for your business loan. You’ll need to fill out your lender’s application form, which you can do online, after which you can submit it directly to your lender via their online portal.

Receive your outcome and funds

You can receive your outcome very soon after, with fast approvals in as little as an hour available from some lenders. Upon approval, you’ll be sent through a loan contract to sign, which can be done electronically, after which funding is available as soon as the same day you submitted your initial application.

Compare business loans

Compare a range of business loan offers right here with Savvy. We’re partnered with lenders across the country to help you access financing wherever you’re based. Start comparing your options today to help you save on your loan and receive the money you need fast.

site-logos OnDeck Business Loan
  Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee Annual Fee  
site-logos $10,000 $250,000 6 to 24
3% $0
Go to site

Lightning business loans up to $150K can be funded in as fast as 2 hours - simply provide 6 months of recent bank statements.

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site-logos Lumi Unsecured Business Loan
  Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee Annual Fee  
site-logos $5,000 $500,000 3 to 36
2.5% $0
Go to site

Boost your business with fast hassle-free funding from Lumi. Apply online in five minutes without harming your credit score and get funds in as quickly as 24 hours. For a limited time: Business Loans with No Repayments for the first 6 weeks. T&C apply.

More details
site-logos Lumi Lux Rate Reducing Business Loan
  Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee Annual Fee  
site-logos $200,000 $500,000 12 to 48
3.50% $0
Go to site

Lumi Lux™ is an innovative rate-reducing business loan that rewards customers with good repayment histories and no contractual breaches throughout their loan term by dropping interest rates by 25 basis points (0.25%) every six months

More details
site-logos Valiant Finance Business Loan Broker
  Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee Annual Fee  
site-logos $5,000 $1,000,000 3 to 60
$0 $0
Go to site

Valiant is Australia’s leading business loan broker with a network of over 80+ lenders. Apply for a business loan between $5,000 and $1 million and get approved in as little as 24 hours.

More details
site-logos ebroker Unsecured & Secured Business Loans
  Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee Annual Fee  
site-logos $5,000 $3,000,000 6 to 360
$0 $0
Enquire now

Compare, find and match fast to over 80 bank and non-bank lenders accessing much needed working capital from a unsecured business loan.

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Disclaimer: Savvy is not advising or recommending any particular product to you. We provide general information on products for the purposes of comparison, but your personal situation or goals are not considered here. Although we try to make our comparisons as thorough as possible, we do not have information on all products on the market on our site.

You should always consult a given offer's PDS or further documentation in the process of deciding on which loan to choose, as well as seeking independent, professional advice. If you decide to apply with one of the lenders listed above via our website, you will not be dealing with Savvy; any applications or enquiries will be conducted directly with the lender offering that product.

Frequently asked small business loan questions

How much can I borrow?

Small business loans can allow a borrowing range of anywhere between $5,000 and $500,000, depending on the type of loan you’re after. Many lenders will cap their maximum loan amounts at $250,000 to $300,000. However, what you can actually borrow will be decided by your business’ financial situation, credit score and other individual factors. You can use Savvy’s loan repayment calculator to provide a rough estimate of what you might have to pay over the course of your loan agreement. 

How long can my business loan run for?

Unsecured business loans are available for terms as short as three months and as long as three to five years. This flexibility enables you to mould your repayments to suit your business’ financial needs. For instance, if you wanted to keep your repayments at a more manageable level for your small business, you might want to lengthen your term to around three years. Alternatively, if you want to pay off your loan quickly to reduce your interest outlay, you can opt for a shorter term.

Are business loans available for any industry?

No – some lenders will place limitations on the industries with which they’re able to work. You should always check with your lender in advance if there are any restrictions which may affect your plans to access the funds you’re looking for. For instance, some lenders won’t work with debt collection agencies, foreign currency exchange services, not-for-profits or investment businesses, to name a few.

How much deposit do I need for a business loan in Australia?

You don’t need to put up a deposit for your business loan if you don’t want to. While it may help you access a lower interest rate and reduce the cost of financing overall, there’s no obligation for you to put forward a lump sum to your lender.

What if I don’t have the right documents for my loan?

If you don’t have the right documents for your application, such as tax returns, you can look to a low doc business loan. This may be the case for startup businesses which haven’t been in operation long enough to have the documents they need. Similarly, because they’re seen as posing a greater risk to your lender, borrowing ranges will be limited and rates will be higher. However, if you gather the right documents over the course of your repayment term, you can potentially refinance to a standard loan and slash your rate.

Can my country business still get approved for a loan?

Yes – you don’t have to be applying for a loan from Sydney or Melbourne to get approved for financing. Our online business lending partners can approve applications regardless of where you’re based, provided you can meet all the other required criteria. This means that in this day and age, there isn’t really such a thing as a Sydney or Melbourne business loan.