If your business has been approached by quick-turnaround, non-bank lenders promising fast funding with little paperwork, you’re definitely not alone, we’ve get them too and understand what a minefield it can be. That’s why we work exclusively with trusted lenders to ensure have access to the best solutions for your business.
As your finance broker, it’s my job is to help you protect your long-term financial health, not just secure a quick loan, so talk to us first.
What Are These Fast Cashflow Lenders?
These are alternative lenders specialising in unsecured, short-term business loans. They offer fast approvals and high acceptance rates, but often come with higher costs and stricter repayment terms.
Typical Loan Costs
Imagine you borrow $10,000 with one of these unsecured short-term loans. Here’s what the costs might look like:
- Factor Rate: This is a multiplier on the amount you borrow. For example, if the factor rate is 5, you will repay $15,000 total (that’s your original $10,000 plus $5,000 in fees and interest).
- Interest Rate Range: This can be anywhere from 20% up to 80% or more APR (annual percentage rate). So, if you borrowed $10,000 for one year, you might pay anywhere from $2,000 to $8,000 or more in interest alone.
- Fees: On top of interest, there can be establishment fees (e.g., $200–$1,000 just to set up the loan), and early payout fees if you want to pay the loan off sooner.
- Repayment Terms: These loans are usually paid back quickly sometimes daily or weekly over 3 to 12 months. That means you might have a few hundred dollars deducted from your bank account every week.
Note: These are real-world ranges based on client outcomes. Costs vary depending on credit, turnover, industry, and term.
Risks to Watch
-
Credit File Activity
These lenders often run credit checks and report defaults or missed payments quickly. This can lead to drops in personal and business credit scores. - Daily/Weekly Repayments
These repayment schedules can strain cashflow quickly if not carefully planned. Many clients underestimate how much will be withdrawn regularly. - High Early Repayment Costs
Loans may not reduce interest if you pay early—you could still owe the full agreed amount. - Loan Stacking & Over-Borrowing
Some lenders approve more than you should borrow, or offer additional loans before the first is paid off which can create cashflow stress.
Why Speak to Your Broker First
As your broker, we:
- Explain the real cost before you commit
- Help you avoid credit file damage or over-borrowing
- Compare multiple options including traditional lenders and lower-rate alternatives
- Negotiate better terms on your behalf
Case Study: Refinanced Overdraft for Expanding Allied Health Provider
Client Overview
Our client operated a successful allied health business delivering services such as speech therapy, occupational therapy, psychology, nutritional support, and in-home care. These services were primarily funded through Medicare and the NDIS, providing the business with a stable and consistent revenue stream.
As the business experienced rapid growth, the client began expanding their team, which came with increased recruitment costs and the need for repairs on one of their service vehicles. To manage these operational expenses and improve cash flow, they sought an overdraft facility.
The Challenge
Before engaging our services, the client had arranged a $75,000 overdraft facility with a lender who does short term business loans directly. However, the experience proved to be problematic:
- The client was misinformed about fees and interest rates
- Weekly charges were applied, even though no funds were drawn
- The effective interest rate exceeded 80% when fees were considered
- A general security interest was registered over the business
- The lender failed to provide clear or upfront terms
Although the facility remained unused with a $0 balance, the unexpected fees and lack of transparency made it unsustainable. The client initiated the closure of this facility and approached us to source a more suitable solution.
Our Solution
After assessing the client’s financials including strong turnover, excellent credit history, and perfect repayment performance we arranged to refinance the existing overdraft into a more appropriate facility.
We secured a $100,000 overdraft with significantly improved terms:
- A clear and transparent much lower interest rate
- No ongoing weekly charges
- A flat annual facility fee of $495
- No additional security registration over the business
The previous facility was fully closed prior to settlement of the new overdraft.
Outcome
The refinance enabled the client to access a larger, more cost-effective funding solution that supported their growth trajectory. By eliminating hidden fees and securing transparent terms, the client was able to manage their cash flow more effectively and continue scaling with confidence.
Call Us First
Even if you’re considering a fast cashflow loan, it pays to have someone on your side.
Let’s make sure your next finance move is a smart one.
