Home - Services - Short Term Business Loans
Short term business loans cover funding needs with a natural end date: a seasonal stock order, a gap while you wait on a large invoice, a tax bill, or a project that pays out on completion. Short term business loans are designed for temporary funding needs with a clear purpose and relatively short repayment horizon, typically between 3 and 12 months. No multi-year commitment hanging over a need that only lasts a quarter.
Formation Finance assesses short term business loan applications based on factors such as recent revenue, cash flow, trading history and the purpose of the loan. Funding from $5,000 to $500,000 may be available for eligible businesses, depending on lender assessment.
| Key Features | Short Term Business Loan |
|---|---|
| Loan amount | $5k – $500k |
| Term | 3 – 12 months |
| Repayment | Daily, weekly or monthly |
| Security | Unsecured options available (director guarantee may apply) |
| Min trading history | 4 months |
| Min monthly revenue | $10,000 |
| Interest rate from | From 12% p.a. (case-by-case) |
| Early payout | Anytime, no penalty (some products may discount remaining interest) |
| Typical timeframe | Funds as fast as the same day, typically within 1–2 business days |
All figures are indicative only and not an offer of finance. Availability, terms and timing are subject to lender approval, credit assessment and receipt of required documentation. For business and investment purposes only.
Repayment estimator
Estimate repayments on a short term business loan from $5K to $500K over 3 to 12 months. Move the sliders to see how a shorter term changes what you repay.
We Need Just Three Things:
No property required, no business plan, no two years of financial statements. Lenders assess you on your bank statements and recent trading.
What helps most on a short term application is a visible repayment source: seasonal revenue that’s about to arrive, a large invoice due within the term, a progress payment on a signed contract, or a tax refund. You don’t need documents proving it in most cases, but timing your application so your bank statements show the pattern makes approval easier and often improves the amount offered.
The right loan term depends on how long your business needs the funding and how comfortably it can manage repayments. A shorter term generally means higher regular repayments, while a longer term spreads repayments over more time.
| Loan Term | May Suit | Things to Consider |
|---|---|---|
| 3 Months | Very short cash flow gaps, urgent stock purchases or expenses with expected near-term income | Repayments are typically higher because the loan is repaid over a shorter period |
| 6 Months | Seasonal inventory, project costs, supplier payments or temporary working capital needs | Provides more repayment time while keeping the borrowing period relatively short |
| 12 Months | Larger short-term expenses, business improvements or funding needs that require more time to repay | Regular repayments may be lower than shorter terms, but the business carries the loan for longer |
The shortest available term is not always the best option. Consider your expected cash flow, repayment capacity and when the funding is expected to generate or free up cash before choosing a loan term.
A homewares retailer in Melbourne’s east had supplier quotes for its biggest Christmas order yet, with a 15% early-order discount expiring in a week. The business had the sales history to justify the order but not the spare cash in October, when rent, wages and BAS had just gone out.
Through Formation Finance, the owners secured a $70,000 short term business loan over 6 months, approved on their bank statements within one business day. The funds covered the full order plus freight, and the early-order discount alone offset most of the borrowing cost.
December trade came in 40% above the previous year. The owners paid the loan out in full in late January, four months early, with an interest discount for early payout. Total borrowing cost after the discount was under $1,800 against a stock order that returned its margin twice over.
Loan type: Short Term Business Loan
Amount: $70,000
Term: 6 months, paid out at month 2
Purpose: Seasonal stock order with early-order supplier discount
Result: December revenue up 40% year on year, loan cleared 4 months early
A short term loan matched the shape of the need: money out in October, money back in January, nothing left owing by February.
01 Apply in minutes
A 10-minute online form. No tax returns or financials for loans under $150K.
02 Verify your bank statements
Through a secure online link. No printing, scanning or chasing paperwork.
03 Get funded
Same-day funding at the fastest, typically within 1 to 2 business days of approval.
For a business with steady takings, smaller frequent debits are often easier to manage than one large monthly hit. Where it goes wrong is borrowing too much relative to turnover. Before you accept an offer, check whether debits pause or only retry on low-balance days, whether you can switch frequency later, and what the dishonour fee is. We flag all three on every product we place.
Yes, anytime, with no penalty. Some products discount your remaining interest for early payout, which is exactly how short term borrowing should work: the need ends, the loan ends.
Depending on the lender and your repayment history, terms can often be renewed or refinanced before maturity. Talk to us before the term ends rather than after, as options are wider earlier.
We assess your scenario first and approach the lender most likely to approve your profile, so you typically end up with one credit enquiry rather than several.
