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| Your need | Option to examine | Main check |
|---|---|---|
| One purchase with a clear payback period | A term loan | Can cash flow cover every scheduled repayment? |
| Repeated, uneven cash shortfalls | A line of credit or overdraft | What does the unused limit cost, and can access be restricted? |
| A vehicle or machine with a long working life | Asset finance | Compare the total cost and security against an unsecured quote. |
| Covering continuing losses | A cash flow and debt review first | A new repayment may deepen the shortfall. |
What makes the loan unsecured?
The label usually means the lender does not take specified property as collateral. It does not describe every obligation in the agreement. A personal guarantee can make an owner liable for business debt; a general security agreement may give the lender rights over business assets. Ask the lender to identify each security and guarantee document in writing.
Prospa describes personal guarantees on its unsecured lending page (checked 5 October 2026). The agreement therefore needs a closer assessment than a simple “asset risk: none” label.
What you gain by borrowing without a property mortgage
The practical attraction is keeping a particular asset out of the mortgage process and using the advance for a defined business need. That may reduce valuation work, but it does not establish the speed, price or documents required for your application. Nor does it make the agreement free of security or guarantees. Compare the actual offer with an eligible secured alternative before deciding that the flexibility is worth paying for.
An unsecured term loan can be useful for an expense that does not produce a readily financeable asset: a stock order, a marketing commitment tied to a credible sales plan, or the costs of delivering a new contract. The weakness is that repayments can start before the spending produces cash. Borrowing for a speculative campaign is a different proposition from financing stock already ordered by a reliable customer.
Eligibility is more than reaching a turnover threshold
Ask whether the product accepts your business structure, industry, trading history and purpose before applying. Then distinguish revenue from the cash left to pay debt. A business taking $60,000 a month but spending $58,000 before existing finance has a different case from one with the same sales and lower commitments. These illustrative figures explain the distinction; they do not imply an approval formula.
Prepare recent bank activity, a complete debt list and records explaining the proposed purchase. If turnover is seasonal, include the quieter period rather than presenting the best month as normal. Explain transfers between your own accounts, one-off asset sales and large customer deposits so they are not confused with repeat trading receipts. The government's business loan application guide identifies financial records, cash flow and a business plan among the information relevant to an application (checked 5 October 2026).
Compare the repayment schedule before the rate
Request a quote showing the amount paid into your account after deductions, all repayments, establishment and ongoing fees, and the amount required to repay early. A monthly rate, annual interest rate and factor rate describe different things. Multiplying a monthly figure by 12 does not produce an all-in annual cost.
Check the first repayment, not just the final one
Suppose a wholesaler pays for stock now and expects customer money in eight weeks. The stock may have a sound profit margin, yet the business still needs cash for any loan instalments due before those receipts arrive. Show that money in the forecast rather than assuming the sale itself will cover every payment.
Ask for the first debit date, payment frequency and amount. Add wages, rent, tax and existing finance on their actual dates, then delay the expected customer receipt. That test helps show whether the borrowing fits the trading cycle or creates another gap immediately.
A published maximum is a product limit, not a likely offer. Trading history, revenue quality, existing debts, credit information and the lender's assessment all matter. Size the request around the expense and a workable repayment plan, not the largest number on the advertisement.
A quote should survive a dollar-cost comparison
Consider an illustrative $30,000 loan with $36,000 of scheduled repayments and a $600 fee deducted from the advance. The business receives $29,400 and pays $36,000: a $6,600 difference. Calling the loan a $30,000 advance without showing the deduction overstates the money available for the purchase. This is a cash-cost example, not an annual percentage rate; the payment dates are needed to compare annualised borrowing costs.
Ask for the payout amount at a realistic early-exit date as well as the full-term schedule. A fixed total charge may not fall in the same way as interest on a reducing balance. If the plan is to repay after a large invoice arrives, that difference can decide whether the loan is worth taking.
A top-up also deserves a fresh comparison. Establish whether it creates a separate loan or replaces the existing facility, how much clears the old balance and what new cash remains after fees. Compare the combined repayments before agreeing. A larger approved amount is of little use if most of it pays out debt and the weekly deduction rises beyond what trading can support.
When we would compare another option
For an asset that should earn income for several years, compare finance secured against that asset. For recurring shortfalls, compare a revolving facility. If you already have several short loans, review the combined repayments before adding another.
Choose an unsecured offer when the flexibility is worth its full quoted cost and the debit schedule fits your cash flow. Keep the quote, repayment forecast and guarantee documents together so the decision can be checked before signing.
Published loan terms and security limits
The provider pages below were checked on 10 October 2026. These are selected examples, not a ranking or a statement that every amount is unsecured. Minimum criteria do not establish approval; a personal guarantee can create personal liability without a mortgage over a specified asset.
| Provider | Published amount | Term | Minimum trading and revenue | Security qualification |
|---|---|---|---|---|
| Prospa | $5,000–$500,000 | Up to five years; calculator restricts terms longer than three years to amounts above $150,000 | From six months trading; $6,000 monthly turnover; Australian citizen or permanent resident aged 18+; assessment applies | No upfront asset security up to $150,000 provided obligations continue to be met. Above $150,000 or combined exposure above that level, property ownership required and asset security may be required. Do not infer no personal guarantee. |
| OnDeck | Lightning $10,000–$200,000; Plus $200,000–$300,000 | 6–30 months; fixed weekly repayments | At least one year in business; $100,000 annual revenue; no current/recent major credit issues; individual assessment | Unsecured; personal guarantee required |
| Lumi | Up to $1 million; limits and approval apply | Loan headline up to five years. Line repayment maximum five years, reset on each draw; annual facility review. | Australian registered business; six months trading; $50,000 annual gross turnover; ABN/ACN | Most loans/lines up to $300,000 described as unsecured; larger limits may need property backing. Business-loan FAQ explicitly requires a personal guarantee from the owner. |
| Bizcap | $5,000–$7.5 million headline across options; secured maximum is not an unsecured promise | FAQ: small-business loans generally3–12months; not universal for bridging or other products | Active ABN/ACN; at least four months trading; $12,000 minimum monthly revenue; individual assessment | Product FAQ: loans up to $30,000 may be available without upfront security, but a personal guarantee is required. Larger amounts require product-specific confirmation. |
| Capify | Small-business-loan FAQ: unsecured up to $500,000. Separate secured page advertises $2,000,000+. Do not present overall homepage maximum as unsecured. | No current universal term verified from the sources checked | Small-business FAQ: active ABN; six months trading; $10,000+ monthly turnover; Australian citizen/permanent resident aged18+; assessment required | Secured and unsecured offers coexist. FAQ statement all loans unsecured conflicts with secured product page; use product-specific offer and verify guarantees. |
Capify separates an unsecured limit from its larger secured product. Bizcap’s overall maximum includes facilities that may require security. For a quote, request the security schedule and guarantee before relying on the advertised limit. Moneysmart explains the obligations of a guarantor; our personal guarantee guide covers the business borrowing questions.