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What is an Unsecured Business Loan?

An unsecured business loan is a type of financing option that does not require collateral or security. Instead, the lender provides funds based on the borrower’s creditworthiness, financial history, and other factors such as their business plan and revenue projections.

Unsecured business loans are often used by small and medium-sized businesses to cover short-term or immediate expenses such as inventory purchases, marketing campaigns, or equipment upgrades. They can also be used for longer-term investments, such as expansion plans or new product development.

The application process for an unsecured business loan is typically simpler and faster than that of a secured loan, as there is no need to provide collateral. The loan amount and repayment terms vary depending on the lender, the borrower’s financial profile, and the purpose of the loan.

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How to get started for Unsecured Business Loan?

Check your Eligibility for an a Unsecured Business Loan

  • Have an approved credit check and strong bank statements is needed.
  • You will need to demonstrate that you have the means to keep up the repayments and meet certain criteria to prove this.
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Why Unsecured Finance?

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No Collateral Required
Unsecured finance does not require any collateral, such as property or assets, which can be beneficial for businesses that do not have significant assets to use as security. This means that borrowers do not have to put their personal or business assets at risk, which can be a major advantage in case of default.

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Quick Access to Funds
Unsecured finance can often be obtained more quickly than secured finance, as there is no need for a lengthy asset valuation process. This can be particularly important for businesses that require funding urgently, for example, to take advantage of a time-limited
opportunity or to cover unexpected expenses.

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Unsecured finance are ideal for SMEs and can be used for a variety of purposes, giving borrowers more flexibility in how they use the funds. This can include anything from investing in new equipment or technology to hiring new staff or launching a marketing campaign. Lenders typically do not require businesses to have been trading long-term and the lack of collateral also means that borrowers can use the funds for any purpose they choose, without the need for the lender’s approval.


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Helping SME businesses grow all across Australia

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“Scott was an amazing professional; and friendly person to deal with!! He made us feel comfortable and with his personal touch made it easy and trust assured that he had our business in his best interests at all time! Would highly recommend to anyone.”

Samantha Hansen

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Frequently Asked Questions

The maximum amount that can be borrowed through an unsecured business loan varies depending on the lender and the borrower's financial profile. Typically, the maximum amount ranges from $50,000 to $500,000.

The interest rate for unsecured business loans varies depending on the lender and the borrower's financial profile. Generally, the interest rates for unsecured business loans are higher than secured loans, as there is no collateral to reduce the risk to the lender. Interest rates can range from 7% to 30%, but the average is around 10% to 15%.

The repayment period for an unsecured business loan can vary depending on the lender and the amount borrowed. Typically, repayment periods range from 1 to 5 years.

Eligibility criteria for an unsecured business loan varies depending on the lender. However, most lenders will look at the borrower's credit score, revenue, profitability, business plan, and financial history when considering an application for an unsecured business loan.

Penalties for prepayment of an unsecured business loan depend on the lender and the loan agreement. Some lenders may charge a penalty for prepayment, while others may allow prepayment without penalty. It's important to read the loan agreement carefully and ask the lender about any penalties for prepayment before signing the agreement.

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