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On a small screen, scroll the table sideways to see every column.
| When | Action |
|---|---|
| A payment looks doubtful | Contact the lender and explain the cause, amount and likely duration. |
| You need a temporary change | Propose payments supported by a cash flow forecast and request written terms. |
| A notice or demand arrives | Read deadlines carefully and obtain prompt legal or debt advice. |
| Several debts cannot be paid | Review the whole position with a qualified adviser or financial counsellor. |
| The business is a company | Ask about director duties and the consequences of continuing to incur debts. |
Make the first call concrete
Have the loan reference, amount due, cash balance and a short forecast in front of you. Explain the cause of the problem and whether it is temporary. A delayed invoice, a closed premises and continuing trading losses need different responses.
Suppose a $3,000 payment is due on Friday but the business has only $1,000 available after essential operating costs. State those figures and the date of any expected receipt. Do not promise the full amount next week unless the forecast supports it. Ask what assistance the lender can assess and which documents it needs.
Record the contact person's name, what you supplied and the response. Obtain any variation in writing, including revised dates, charges and what happens afterwards. A request for help does not itself change the original repayment obligation.
Understand what default can trigger
The agreement may define default more widely than a missed instalment. Read its notice, additional charges, acceleration, security and guarantee provisions. Recovery steps and notice requirements depend on the contract and applicable law; there is no single timetable suitable for every business loan.
Secured assets and guarantors can be exposed. An asset sale may not clear the full amount owed. Get advice on the actual documents rather than assuming that surrendering equipment or closing the business ends the debt.
Assess a proposed payment change before agreeing
A temporary reduction can help with a short disruption, but establish what happens to the unpaid amount. Is it added to later instalments, moved to the end or dealt with another way? Ask whether interest and fees continue, whether the term changes and whether a larger final payment will result.
For illustration, reducing a $2,000 monthly payment to $1,000 for three months postpones $3,000 before any extra interest or charges. If that amount is then spread over the next six months, it adds $500 a month to the later schedule. That may work if a documented shortfall has ended; it may be too much if trading has not recovered.
Do not agree to a catch-up schedule merely to end an uncomfortable call. Put it into the forecast and explain if it is unaffordable. Keep the lender informed where an expected customer payment changes. A workable proposal should reflect money reasonably expected to arrive, not a best-case date chosen to satisfy a request.
Keep notices, calls and disputed amounts organised
Save statements, the agreement, notices, correspondence and your payment records together. Identify the amount claimed, the due date and any deadline for a response. If you dispute the balance or a charge, describe the disputed item precisely and supply the relevant evidence. Do not assume that raising a dispute automatically stops every contractual or legal deadline.
If a third party contacts you, establish who they act for and the account involved before providing information or agreeing to payment. Obtain advice about formal demands, threatened proceedings or enforcement against property. The correct response depends on the document and circumstances, so a general article cannot give a universal number of days to act.
A shortfall is different from ongoing inability to pay
If a reliable customer will pay shortly, a temporary arrangement may be worth discussing. If the business cannot pay debts as they fall due, the problem may require a broader response. ASIC urges company directors to respond early to financial difficulty and seek professional advice.
Do not choose which debts to ignore based on this guide. Tax, employee, secured and other obligations can have different consequences, particularly for company directors.
Bring an adviser the complete position
List all creditors, amounts due, securities, guarantees and upcoming obligations. Include wages and tax, customer money owed to the business and the cash cost of continuing to trade. Looking at one loan in isolation can hide a much larger shortfall.
ASIC advises company directors to obtain advice promptly and not incur further debt if the company is insolvent (checked 5 October 2026). This is why a company facing repeated inability to pay needs more than a negotiation about one instalment. An accountant, lawyer or registered insolvency practitioner can assess the available routes and duties.
If the issue concerns the lender's handling of a request, ask for its complaints process and a written response. Any external complaint route depends on the provider, product and the complaint's eligibility. Do not assume every commercial lender is covered by the same scheme, or that making a complaint cancels the debt.
Help is most useful when the records are current. Bring the latest figures even if they are uncomfortable; waiting for perfect accounts can delay a decision that needs to be made now.
Where to get help
The Small Business Debt Helpline provides free, independent and confidential financial counselling. ASIC lists it among the support resources available to small business owners in financial difficulty. A lawyer, accountant or registered insolvency practitioner may also be appropriate depending on the circumstances.
The immediate task is to understand what the business can pay and which deadlines require action. Assess a refinance, asset sale or new loan against that position with an adviser; do not use a pending application as a reason to ignore a notice.