Home - Services - Unsecured Business Loans
| Key Features | Unsecured Business Loan |
|---|---|
| Loan amount | $5k – $500k |
| Term | 3 – 36 months |
| Repayment | Daily, weekly or monthly |
| Security | No property security required (director guarantee may apply) |
| Min trading history | 4 months |
| Min monthly revenue | $10,000 |
| Interest rate from | From 12% p.a. (case-by-case) |
| Typical timeframe | Indicative approval in as little as 3 business hours. Funds may be available as fast as the same day, typically within 1–2 business days. |
All figures are indicative only and not an offer of finance. Availability, rates, 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 an unsecured business loan from $5K to $500K. Move the sliders to see how the amount, term and rate change what you repay.
With an unsecured business loan, the lender does not register a mortgage over property or take a charge over specific equipment. Instead, it assesses whether your business can repay from its cash flow, mainly by reviewing your business bank statements, trading history, existing debts and credit file.
If approved, you receive a lump sum (or a credit limit) and repay it over 3 to 36 months through daily, weekly or monthly repayments. Because there is no property valuation or security registration, approval is usually much faster than a secured loan, but the rate is higher to reflect the lender’s risk.
This type of funding suits established businesses generating consistent revenue who need fast working capital without tying up property. Common profiles include:
Minimum eligibility:
Startups under 4 months of trading and pre-revenue businesses generally do not qualify for unsecured business loans. If your business is in early stage, consider private lenders loans against personal property security as an alternative.
Unsecured business loan pricing varies by lender based on your trading history, monthly revenue, industry, loan size and creditworthiness. Indicative ranges:
All fees, total cost and repayment schedule are confirmed in writing before you accept an offer.
Unsecured finance may be worth considering if:
However, unsecured lending may not always be the most cost-effective structure.
If you require a substantially larger loan, have suitable security available or want to spread repayments across a much longer period, another type of business loan may be more appropriate.
Formation Finance can help compare the available structures based on your business rather than forcing the application into one particular loan type.
Secured Business Loan | Unsecured Business Loan | |
Security required | Property, equipment, or other major asset | None (director guarantee may apply) |
Loan amount | $50k – $50M+ | $5k – $500k typically |
Interest rate | From 7% p.a. | From 12% p.a. |
Approval time | 2–6 weeks | 3 hours indicative / next-day funding |
Documentation | Asset valuation + business financials | Bank statements + ABN |
Best for | Larger borrowings, lower cost, businesses with assets to offer | Speed, no property risk, working capital under $500k |
How to choose: Unsecured loans suit businesses needing fast working capital under $500k who either don’t have property to offer or don’t want to tie property up. Secured loans become significantly cheaper above $500k, or when the cost difference is material to your business case.
If your situation needs secured funding instead, our second mortgage loans and commercial property loans may be a better fit.
Most lenders on our panel look for an active ABN, at least 4 months of trading history and average monthly revenue of $10,000 or more. They also review your business bank statements, existing debts and credit history. Meeting these minimums means you can apply; it is not a guarantee of approval.
Unsecured business loans typically range from $5,000 to $500,000. The amount depends mainly on your average monthly revenue, trading history, existing repayments and industry. Business lines of credit up to $750,000 are available, and larger facilities up to $5,000,000 may be possible where directors’ guarantees or partial security are provided.
Indicative approval can come back in as little as 3 business hours once your bank statements are verified. Funds may arrive the same day, but 1–2 business days after you accept the offer is typical. Larger loans that need financial statements take longer.
For smaller loans you usually need your ABN, a director’s driver’s licence and 6–12 months of business bank statements, typically shared through a secure, read-only bank link. For larger amounts, lenders may also ask for recent BAS, financial statements and an ATO portal statement.
Possibly. Some lenders consider businesses with past defaults or an ATO payment arrangement if current revenue and banking conduct are strong. Expect a higher rate and a lower limit. Tell us about any credit issues upfront so we only approach lenders likely to approve, which avoids unnecessary credit enquiries.
Rates start from 12% p.a. and depend on your risk profile, loan size and term. Establishment fees typically range from 1.5% to 4% of the loan amount. Some short-term products use a factor rate instead of an annual rate, so we show you the total repayable amount in writing before you accept, letting you compare offers like for like.
Many lenders on our panel allow early repayment without a penalty, and some offer an interest discount for paying out early. Conditions differ between lenders, so we confirm the early payout terms before you sign.
Any legitimate business purpose, including working capital, stock and inventory, equipment, wages, marketing, fit-outs and repairs, or covering seasonal cash-flow gaps. Unsecured business loans cannot be used for personal or household purposes.
Contact the lender straight away. Missed repayments usually attract dishonour or late fees and can be reported on the business’s and directors’ credit files. Ongoing default can lead the lender to call on the director’s guarantee. If cash flow is tight, talk to us early, because restructuring or refinancing is easier before arrears build up.
