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Is a fast business loan right for your business?

by OnDeck Australia,   Apr 10, 2018

 

It’s not uncommon for businesses to finance growth and specific capital needs with a short term business loan. There are times when fast access to additional capital, or access to a quick business loan, is critical. This is especially the case when unexpected opportunities arise to create a ROI.

A traditional small business loan from the bank can be a suitable option in specific circumstances. Nevertheless, the long application process for a bank loan can be burdensome when you need the funds for more immediate business needs. When unexpected expenses, or opportunities, require fast access to funding, your bank is not always the most suitable choice.

Fortunately, in many circumstances, a quick answer to your loan application is available online. Online lenders, like OnDeck, can have a decision and funding in as fast as one business day.

 

Common circumstances that require a fast business loan 

While we understand that not all businesses are the same, here are some of the most common unexpected business costs your business might face:

Opportunities to expand

Whether it’s adding an outdoor seating area or leasing a larger space, physical expansion can help accommodate the growth of your business. Maybe that extra space next door is available, or a bigger storefront down the road is up for sale. The opportunity to expand can make it possible to secure more customers and generate more income. However, the added expense might be something you hadn’t anticipated. As a result, quick access to capital can help you pull it all together and take advantage of an opportunity for expansion.

Employees

Hiring new employees is often essential to sustaining growth. Still, from training to salaries, employees are sometimes an expensive addition to your business. When hiring new employees, it’s important you have adequate cash flow to cover the associated needs.

Maintenance Issues

The same way you might need to call the plumber occasionally to your house, you might have maintenance issues at your business premises. Water leaks, electricity or drainage issues are all factors you might not have accounted for when calculating your budget. You likely won’t have the time to wait around while the banks process your application to only fund you weeks, if not months, later. Therefore, fast funding from an online lender is a great alternative.

These are only a few unexpected business costs that may arise. For more information on what you can do to prepare your business for unexpected business costs, check out one of our earlier posts.

 

Fast Funding

We live in a world where we expect everything instantaneously, waiting just isn’t a priority. An Australian Commissioned Paper on trends in the Australian loan market, showed that a major attraction of online lenders is their “instantaneousness”.* As business owners don’t have endless time to spend searching and applying for a loan, therefore a quick answer and fast funding is increasingly important.

Almost a third of small business owners take out a loan to cover short term cash flow.^ If you have an immediate need for a cash flow boost, it’s not very helpful if you have to wait weeks, to receive a loan.

 

A Fast Business Loan from OnDeck

Traditional banks often require collateral before approving your business for a loan. They also can rely heavily on the business owner’s personal credit. OnDeck, however, offer unsecured short term business loans. This means that OnDeck do not take security against your loan, however we do require a personal guarantee. Moreover, OnDeck use other data points, including credit score, to evaluate an application. With loans from $10,000-$250,000 over 6-24 month terms, you can apply for an OnDeck short term business loan in less than 10 minutes. If you’re approved, you can have your funds in as fast as one business day. With OnDeck, you can access the capital you need, quickly. This means less time spent searching for finance, more time focusing on running your business.

 


* Australian Centre for Financial Studies, Trends in the Australian Loan Market, October 2015. https://australiancentre.com.au/wp-content/uploads/2015/10/Commissioned-paper-Trends-in-the-Australian-small-loan-market.pdf 

^ MYOB, 4 reasons why small businesses need to take out loans, March 2017. https://australiancentre.com.au/wp-content/uploads/2015/10/Commissioned-paper-Trends-in-the-Australian-small-loan-market.pdf 

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