When you’re getting your business off the ground, you need financing. Many entrepreneurs turn to start-up loans, which are loans for small businesses that are just starting out.
The problem that a lot of new businesses run into with start-up loans in Australia is that many banks aren’t willing to lend to new ventures. There’s more risk involved when a borrower doesn’t already have a well-established business with a proven track record of steady profits.
This doesn’t mean it’s impossible to get the funding you need. Let’s take a look at how a start-up business loan works and your options for start-up business financing.
How Start-Up Loans Work in Australia
Start-up loans are the same as other business loans. You borrow money from the bank or another lender. Then, you’ll repay the loan over a set period of time. You’ll also pay interest and fees. Because a lender won’t have a lot of information to assess related to your business, they may look at your personal financial information.
In order to qualify for a start-up business loan, you’ll need to have good personal credit and a strong business plan. Ideally, you’ve been in business for at least a short amount of time and can demonstrate a monthly revenue.
Start-up Financing Options for Small Businesses
In addition to a traditional business loan, you can consider other options, such as a personal loan, secured business loans, government-backed SBA loans, crowdfunding, and microloans. You may also be able to get some funding from a business grant, especially if your startup is a not-for-profit.
At Cigno Business Solutions, we understand how challenging it can be to get the financing you need to start your business. That’s why we’ve made the process easy. To apply for a start-up loan, all you need is a registered ABN and a 90-day bank statement. Apply today to get started.