How to get a business loan with a poor credit score

How to get a business loan with a poor credit score

Running a business requires a lot of creativity and some serious ambition.

More often than not, it also requires speedy access to cash.

Whether business owners need money to seize a must-not-be-missed opportunity, smooth their cashflow or simply manage the day-to-day, being able to get hold of cash – quickly – can simply make or break their business.

A business loan is a great way to get hold of capital to help build a business and keep it motoring forward, but what if the business owner has got an adverse credit history?

Can they still get a business loan with a bad credit score?

The answer – fortunately – is yes.

While banks will generally turn down credit applications from people with a bad credit score, Bizcap is one of the few lenders in Australia that are happy to help.

What is a business credit score?

A business credit score is a number usually between 0-1200 that gives a lender an indication of the organisation’s credit history.

The credit score is fuelled by data from a wide range of sources, including banks, utility providers and other lenders, and a number of factors, including the number of credit enquiries the business has made, its repayment history and any infringements – for example, defaults or bankruptcy, affect it.

In years gone by, a credit score was something that was difficult to access, but today that information is freely available. For example, credit reporting service Equifax can provide access.

A score 600 and upwards is generally considered ‘good’, while many lenders won’t look at your application if your credit score is 500 or less.

However, Bizcap will.

How can a credit score be repaired?

There are a number of things business owners can do to repair their credit score, including paying bills on time (direct debits can come in handy here), decreasing their credit utilisation ratio (the amount of credit they’re using in context of the amount they have access to), disputing any errors on file, and closing credit facilities – such as credit cards – that they no longer use.

How to get a business loan with a poor credit score

Of course, repairing a credit score can take time – and the business world often doesn’t wait. Bizcap is one of the few lenders in Australia that will assist businesses with a business loan regardless of their credit score – in fact, Bizcap has been able to help customers with a credit score under 100.

Bizcap doesn’t have a credit score minimum – instead they assess each application on its own merits, taking into account factors such as revenue history and assets.

To be eligible for a business loan with Bizcap, organisations just need $10,000 minimum monthly revenue, at least six months’ history and have an active ABN.

Bizcap can provide unsecured business loans up to $500,000 and secured business loans up to $1,000,000 – all businesses need to do is apply online and Bizcap can get funds into their account within three hours.