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How Much Can You Borrow with a Business Loan?

by OnDeck Australia,   Mar 17, 2023

When it comes to how much you can borrow for a business loan, various factors come into play. Your credit score is one of the most important considerations when applying for a business loan, as lenders will use this information to determine how much they are willing to lend you. Additionally, each lender has their own borrowing limits, which are often based on your monthly revenue, which helps assess the amount your business can borrow. Make sure you consider these factors when searching for the best option for your business needs. For example, OnDeck offers 6-24 month loan terms with a borrowing limit of $250,000. 

Ability to repay a small business loan

The starting factor to keep in mind is your overall borrowing capacity. This is how much you can borrow from different lenders combined and depends on how much income your business generates, and how much debt you currently have. Even though any lender you apply to will also determine your borrowing power before agreeing on a loan amount, it’s important to understand how much you are able to realistically afford to repay without impacting your cash flow and day-to-day operations so that you don’t end up taking on too much debt. 


The easiest way to determine how much you can comfortably repay is to subtract your expenses from your business income. The remaining is your monthly turnover, which gives an initial rough idea of what you can afford on a repayment.

Only applying for loans that you have the ability to repay will speed up the loan application process and approval time. Asking for more than you can afford will cause delays.

Business loan interest rates

When calculating how much you can repay, remember to include the interest rate and any other fees included with a possible loan. 

The interest rate on a loan will depend on how reliable the borrower is, usually determined by their credit score and history, and how much risk the lender is taking in lending to them. Borrowers with strong credit histories may be able to find loans with lower rates because they are seen as less likely to default. 

Other fees

Some loans may include other fees, like early repayment fees. 

Borrowing limits on secured vs unsecured business loans

When taking out a loan, there are two options, secured or unsecured. The limit on borrowing for a secured loan is usually higher because if you default, the borrower can claim assets that were used as collateral. 

Unsecured loans on the other hand lack collateral, so lenders will place a lower borrowing limit to reduce the risk for them. The upside being that if there’s a problem, the lender doesn’t just claim your assets.

Business credit score

It’s important to note that your business credit score is not the same as your personal credit score. Whereas your personal credit score looks at how you handle debt as an individual, your business credit score assesses how your business manages its financial obligations. 

This information is used by lenders to determine how much they are willing to lend you for a business loan. A strong business credit score indicates that you’re a low-risk borrower, which may lead to a lower interest rate and a higher maximum borrowing limit on your loan agreement. 

Conversely, a low business credit score may result in not being approved for loans or getting a borrowing limit and/or higher interest rate. Therefore, it’s important to build up your business credit score before applying for a loan so that you can get the most favourable terms possible.


OnDeck requires a minimum business credit score of 400, which makes us a great option for many borrowers, so long as you meet the other criteria.

You can check your business credit score for free without leaving any footprint using our Know Your Score tool.


Projected growth

Projected growth helps the lender understand how likely it is that the borrower will be able to repay the loan, and how quickly. 

If a business borrows money to start a new division or service, the projected growth of existing products can show that the borrower will be able to repay the loan even if the new endeavour fails. If there is no or negative projected growth, then lenders may decline the risk of agreeing to give a small business loan.

A high projected growth indicates that the borrower may be able to pay back quicker, which reduces their overall risk for the lender. Lenders also use this information as an indicator of how successful a business is likely to be, and how much trust can be placed in them when assessing repayment rates. By looking at projections for revenue and profit margins over time, lenders can better determine if a loan is viable for both parties involved.

The repayment schedule

The repayment schedule can have a big effect on how much you can borrow for a business loan. Generally, lenders will consider factors such as how regularly payments have been made in the past and how likely it is that the borrower will be able to make future payments on time. If a borrower has difficulty paying back their loan in the agreed-upon timeframe, lenders may reduce or even deny further borrowing until the previous loan is repaid in full. This means that borrowers need to carefully consider how they are going to repay their business loans before committing to them. If a borrower fails to meet their repayment obligations, this could lead to higher interest rates and additional fees or even legal action from creditors. 

From the borrowers’ end, your cash flow can be affected by business loan repayments if they hit at a bad time, or are for massive sums at once, especially if the repayment period is over multiple years.

OnDeck uses a flexible weekly repayment system for our small business loans that range from 6 to 24 months. Regular weekly payments are made in smaller, more manageable chunks than the monthly schedules offered by some other business finance providers.


Get a loan with OnDeck

Minimum $100,000 gross annual turnover

Minimum 1 year in business  

No bankruptcy

(Prior or recent) 

Minimum 400 business credit score required


Prepared by OnDeck Capital Australia Pty Ltd ABN 28 603 753 215 (“OnDeck”) for general information purposes only. Content may belong to or have originated from third parties and OnDeck takes no responsibility for the accuracy, validity, reliability or completeness of any information. Information current as at March 2023. You should not rely upon the material or information as a basis for making any business, financial or any other decisions. Loans issued in Australia are subject to the terms of a loan agreement issued by OnDeck. Loans are subject to lender approval. OnDeck® is a Registered Trademark. All rights reserved.

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