FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Redbank Small Business Loans
Let me know more about Redbank Small Business Loans
Redbank unsecured loans provides amounts between $5,000 and $100,000. The terms range between 3 and 24 months, cash flow friendly repayments that are either daily or weekly.
What is what makes the Unsecured Loan different from the traditional company loan?
The application to your Small Business Loan in under 10 minutes on the phone. You’ll receive a same day response and have the funds available in just 24 hours. Traditional business loans reference an annual interest rate together with additional fees and charges. This business loan is a cash-based loan which means you be aware in advance of the total amount payable including any fees, charges or charges. Then, it is broken down into weekly or daily repayment figure.
What could the Small Business Loan be used for?
It is a Small Business Loan can be used for almost every company need, such as control of cash flow company remodeling, marketing for purchasing inventory or new equipment, as general working capital and much more. The loan is not available for personal reasons.
About Larger Redbank Business Loans
What is the Larger Redbank Business Loan?
The Larger Business Loan is a larger loan size to support business growth opportunities. Loans range between $100,000 and $500,000 with a term fixed up to 36 months. Repayments are weekly or fortnightly in order to accommodate you cashflow.
How is the Origination Fee calculated?
A Larger Business Loan has an Origination Fee, calculated at 2.5 percent of the amount of the loan.
Do I qualify for the Larger Business Loan?
To qualify for a loan of this size the company needs to be operating for a minimum of 3 years with an annual turnover of at least $700K. The applicant must also be a New Zealand Citizen (or Permanent Resident) with a minimum age of 18 years old, own a New Zealand company (with a valid NZBN/IRD) and be able of proving at minimum 12 months of business.
What can I use the funding for?
A Larger Business Loan is a great option for almost any company use, including company renovations, to purchase new equipment or inventory, as general working capital, and much more. The loan cannot be used for personal purposes.
Is the Larger Business Loan one that requires security?
Asset security is needed for funding of more than $150,000. It’s as a result of an charge over assets and can be registered in the PPSR or making as a caveat.
A personal or director’s ensure is a promise to repay a loan which is generally in nature rather than specifying security over a particular asset. The person who is signing the ensure is personally liable if the business borrower is unable to repay the debt.
The Personal Property Securities Register (PPSR) is an online, central register run by the New Zealand Government. It reflects security interests granted to individuals who own personal property (including goods or assets). The PPSR grants preference over private property assigned depending on the date that a security interest has been registered.
The caveat can be described as a formal form of document to provide the public notice of a legal claim to a property.
What is a pre-approval minus Credit Check?
If you’re seeking the Larger Business Loan that is greater than $250K it is possible to offer an initial pre-approval to ease the process. We could be able to apply for this without a credit check and within 6 hours of the initial application. The pre-approval process is based on a preliminary assessment which includes answering a couple of financial health checks. This is in no way an offer, nor is it a guarantee of financing. Unconditional approval is subject to an extensive credit evaluation and any offer you are offered could be based on different conditions.
Application process
Do I qualify for funds?
You are eligible to apply for a business loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are over 18 years, have a New Zealand company (with a valid NZBN/IRD)
- must show at least six months’ worth of transactions (for for the unsecured loan $5K – $100K) or three years of trading (for the Larger Business Loan $100K or $500K)
How do I apply?
The application process is simple and easy. Just complete the online application in few minutes and a dedicated company credit specialist will contact you to guide you through the process.
To apply for up to $100,000, you’ll need the right identification documents (valid Driver’s Licence) as well as an NZBN/IRD that is valid and at least 6 months of bank statements.
In addition, for larger loan sizes, you’ll require:
$100K-$250K: Information about the application including credit consent, 6-12 months of bank statements, IRD statement (if loan above $150K).
$250K to $500K: Application details including credit consent, 12 months bank statement, an IRD statements, last 2 years finalised financial statements, plus interim financial statements for the current year as well as Aged Payables and Receivables reports.
How fast will I get an answer?
For an unsecured loan ($5K and up) we typically provide an answer within an hour if you apply during standard business hours and let us make use of the advanced bank verification system link to instantly verify your bank information online. If you decide to send us copies of your bank statements , we are able to provide an answer within just an business day.
For the Larger Business Loan ($100K or more) we could be likely to offer you with pre-approval conditional to your application within about six hours. After you’ve signed your pre-approval, the turnaround time is about 2-3 days for final approval. However, it could be faster based on the circumstances of each application. Some deals have been approved in less than 24 hours.
The fastest way for you to apply is ensure you apply during normal company hours. Also, permit us to use the advance bank verification to verify your bank information online. If you decide to send us the copies of bank statements it takes a bit longer.
What is the time frame to receive the funds?
For the Small Business Loan ($5K or more) we can often provide a response in one hour if you make your application during standard business timings and you allow us to use the bank verification system to instantly verify your bank’s information online. If you choose to send us copies of your bank statement, we’ll provide the decision in as little as one business day.
For the Larger Business Loans ($100K up to $500,000) We may be likely to offer you with pre-approval conditional to your application in about six hours. Once you’ve signed the pre-approval, turnaround times are about 2-3 days for final approval, however it could be faster based on the circumstances of each application. Some deals have been approved within the space of 24 hours.
The most effective method is to make sure you apply during standard business hours. You can also allow us to use our advanced bank verification system to verify your bank information online. If you opt to send us documents from your account statement, it can take a bit longer.
How much can I borrow?
We provide loan amounts between $5,000 to $500,000. When you make an application for a certain amount we will consider a number of factors for determining your well-being of your company and the level of repayments that your company can afford. The amount you receive from your loan will be contingent on the specific circumstances the business.
If you apply for a certain amount, we take into consideration a variety of elements to determine your well-being of the company and the extent of repayments your business will be able to support. The amount you receive from your loan will be determined by the particular circumstances the business.
Fees & repayments
How do you charge for a company loan?
When you request one of our company loan, we will assess the risk profile of your business and offer you with a customised proposal that includes the loan amount, the terms and the interest rates. A company loan is an upfront cost loan so you will know the exact amount payable including any charges or interest.
What determines the amount I’m charged?
Business loan interest rates depend on a variety of factors including the amount of money borrowed, the business assets the funds will be used for in addition to the industry that the business is in, how long the company is in operation, whether the business has sufficient cash flow to pay for the loan, and overall well-being or creditworthiness of the company.
What are the fees?
There aren’t any hidden charges with our business loans, and you’ll know precisely how much you need to pay and when, starting from the day you sign up. There’s no compounding interest and the loan comes with no additional fees (as long as you make your payments punctually).
We don’t charge an Application Fee. You can request a credit loan with absolutely no upfront cost and no commitment to apply.
The Origination Fee covers the costs associated with setting up and managing the loan. It is only charged for this fee if you proceed with the loan. The Origination Fee for us is 2.5 percent of the loan amount.
Can I pay off the loan in advance?
You can repay the entire amount of the advance loan at any time.
If you are deciding to do this please contact our helpful business loan professionals. They’ll offer you with details for repayment as well as an early payout amount. This will be calculated as the sum of the principal balance and the accrued interest up to the date of early payout and 1.5% of the principal remaining and any outstanding fees.
What is the process for repayments?
To help you avoid missing due dates and also to be in line with your cash flow general, we offer repayments either weekly or daily. They are automatically deducted from your company account.
Security & privacy
Will my information be secure?
Making sure that your information is secure, and being upfront about how we collect the information we collect, use, share and secure your information, is crucial and is a crucial part of our relationship you.
Is it safe to link my bank account to the platform?
Yes. We make use of industry-standard encryption techniques to protect your sensitive, personal as well as financial data. Our funders are ISO 27001 qualified for our dedication to security for our clients and privacy. We employ a highly sophisticated bank verification system link to immediately verify your bank account information online so we can provide rapid response.
About business loans
What’s an asset-based borrow (a secured loan)?
Asset-based borrowing is when the business owner borrows from an asset that they own to make the loan. The asset may be an asset belonging to the personal, like the family home or it could be a business asset such as a vehicle or other piece of machinery.
The vast majority of banks, not just the major banks, prefer to guarantee loans against an asset. If you’re struggling to pay back the loan then your assets could be offered for sale by the lender. In essence, it’s an opportunity to secure new financing by taking advantage of the value of what you already own.
Do I require security for a company loan?
For loans of up to $150,000, the requirement for asset security is not required upfront to access the money however, we do need a personal guarantee. So long as you comply with your loan obligations (as stated in the loan contract) the security of assets will never be required. For loans over $150,000 typically, you will need personal ensure and security in the form the charge of assets.