Short answer: A cash flow loan is business finance assessed mainly on the money moving through your business account, not on property you own. To get a cash flow loan, the usual path is to check your eligibility, share your business bank statements and go through the lender's assessment, which sizes the loan to your turnover.
How do you get a cash flow loan? The short answer
A cash flow loan is business finance based on how your business trades, not on property you own. The business does not offer a home or commercial building as security. Instead, it shares its bank statements, and the loan is sized to its turnover.
Getting a cash flow loan comes down to three stages: meeting the basic requirements, sharing your bank data and going through the lender's assessment. The sections below cover each stage.
This kind of finance can cover a timing gap, such as wages or supplier bills falling due before customers pay. Our page on managing cash-flow gaps looks at that situation in more detail. Businesses with busy and quiet times of year face a similar problem, which our guide to seasonal cash flow covers.
No property is involved, so a cash flow loan can appeal to owners who rent their premises or who want to keep their home separate from a business debt. The trade-off is that the business's own banking history carries much of the weight in the assessment.
Key takeaways
- A cash flow loan uses the business's turnover, not property, to size the loan.
- IBF's cash-flow lane needs an active ABN, 6+ months of trading and business bank statements shared through a read-only link.
- The online eligibility check makes no credit enquiry. A credit check comes later, with consent, and only if the business goes ahead.
- A loan can bridge a short-term gap, but it can make things worse if the business is running at an ongoing loss.
- Owners of property have a different option, the property-secured lane, which is assessed on equity and the exit.
How does the application process work, step by step?
The application follows a set order, from a short online check through to reading the contract.
- Check eligibility online. The eligibility check takes about 60 seconds and makes no credit enquiry, so it is a low-pressure way to see where the business stands.
- Connect your business bank statements. Statements are shared through a read-only link to the business account, so there is no need to gather and scan paper statements.
- Go through the lender's assessment. The lender looks at turnover to size the loan. In general terms, it also looks at whether repayments seem manageable next to existing costs. No outcome is decided in advance.
- Agree to a credit check if you proceed. A credit check happens only at a later stage, with the borrower's consent, and only if they choose to go ahead.
- Read the loan contract closely. Before signing, check the repayment amounts, the total cost over the life of the loan and what happens if a repayment is missed. Moneysmart has general guidance on borrowing and on comparing loan costs.
If anything in the contract is unclear, ask questions before you sign. Nobody has to commit until they understand what they are agreeing to.
What do lenders look at for a cash flow loan?
IBF's cash-flow lane starts with three basics: an active ABN, at least 6 months of trading, and business bank statements shared through a read-only link. Each one tells the lender something different.
Active ABN. An active ABN shows the business is registered and currently operating. business.gov.au explains how ABN registration works.
Trading history. A minimum trading period gives the lender enough account history to review. A very short window of activity may not reflect how the business normally trades.
Bank statements. Statements give a direct view of how the business trades. In general terms, they show how regular income is and how money moves in and out across a typical month. They also show whether new repayments could sit comfortably alongside rent, wages and other bills.
Turnover. The loan is sized to turnover, so the amount offered depends on the lender's assessment and current policy, not on a fixed figure.
Other details, such as how credit history is weighed or what extra information may be asked for, depend on the lender's current policy. This page does not set out credit score cut-offs, turnover minimums or loan terms, because those depend on each application and on the lender's policy at the time.
How can you get your business ready before you apply?
Some preparation makes the process smoother. It also gives a clearer view of whether borrowing makes sense at all.
Before starting, it can help to have:
- the business's ABN details on hand
- online banking access for the business account, because statements are shared through a read-only link
- a clear idea of what the money is for and how it will be repaid, which Moneysmart encourages borrowers to think through
- a rough picture of upcoming bills and expected customer payments over the coming months
It also helps to know where the business stands on tax. That means knowing whether lodgements are up to date and whether any amounts are owed. The ATO's business pages explain lodgement, paying tax and what to do when a business falls behind. If a tax debt is part of the picture, our guide on getting a business loan with an ATO debt explains how that can affect the options.
For a broader look at finance and funding, business.gov.au has general information on loan types, grants and other support. Reading it alongside a lender's requirements can put a loan in context.
Cash flow loan vs property-secured loan: how do they compare?
IBF has two lending lanes: a cash-flow lane with no property involved, and a property-secured lane for owners of residential, commercial or industrial property. The table shows how they differ.
| Cash-flow lane | Property-secured lane | |
|---|---|---|
| What it's based on | The business's trading and turnover | Equity in property and the exit, meaning how the loan gets repaid |
| Security needed | No property | Residential, commercial or industrial property the borrower owns |
| Trading history | Active ABN and 6+ months of trading | Depends on the lender's current policy |
| Documents | Business bank statements through a read-only link | No financials or tax returns needed |
| How the amount is set | Sized to turnover | $20,000 to $5M, assessed on equity and the exit |
| Credit history | Weighed under the lender's current policy | Bad credit, defaults and ATO debt considered |
On the property-secured lane, overdue lodgements don't stop an application. That point, and the way bad credit, defaults and ATO debt are considered, belongs to the property-secured lane, not the cash-flow lane.
The property-secured lane offers these options:
- second mortgage
- caveat loan, written in Victoria only. In other states and territories, the loan settles straight onto a registered second mortgage
- first mortgage, where the property is unencumbered
If credit history is a concern, our guide on business loans with bad credit explains more.
Who can it suit, and when is a cash flow loan the wrong answer?
A cash flow loan tends to fit a short, clear gap that the business has a known way to repay. It can be the wrong tool when the business is losing money month after month.
In general terms, it can suit a trading business with an active ABN, steady deposits and a timing problem, such as a large supplier bill landing before customer payments come in.
It may be the wrong answer when:
- The business is covering ongoing losses. If costs already outrun income, borrowing to cover losses adds repayments on top. This can make cash flow worse rather than bridging a short-term gap.
- The main pressure is a tax debt. The ATO has general information on payment plans and other options. In some cases, a payment plan on its own may be enough.
- Other support fits better. business.gov.au lists other types of funding, grants and support services that may suit the situation.
Before borrowing from any provider, check their credit licence details through ASIC's credit resources.
Example only: a café's takings dip each winter while rent and wages stay the same. A loan might bridge a seasonal dip if a clear recovery is ahead. If takings have been sliding all year, though, the problem is with the business itself, and a loan would add to the strain.
What are the next steps to check your eligibility?
The next step is a short online check that shows whether the business may fit the cash-flow lane.
To recap, the cash-flow lane asks for an active ABN, 6+ months of trading and business bank statements shared through a read-only link. The eligibility check makes no credit enquiry. A credit check only happens later, with consent, if the business goes ahead.
If you would rather talk it through first, the team is on 1300 863 711, Monday to Friday 9am to 5pm AEST. You can also get in touch online.
When you're ready, start your application and see if you qualify for a cash flow loan. Have your ABN and online banking access for the business account on hand, and it takes only a few minutes to start. Eligibility depends on the lender's assessment.
No obligation. Eligibility is subject to assessment.
This is general information only and does not take into account your objectives, financial situation or needs. All applications are subject to lending criteria, assessment and approval.
Frequently asked questions
How long does my business need to be trading to get a cash flow loan?
IBF's cash-flow lane asks for at least 6 months of trading. The business also needs an active ABN and business bank statements shared through a read-only link. A newer business without that trading history may not fit the cash-flow lane yet. If it owns property, the property-secured lane is assessed on equity and the exit instead.
Does checking my eligibility affect my credit file?
The online eligibility check makes no credit enquiry. A credit check happens only at a later stage, with your consent, and only if you decide to go ahead. Moneysmart has general information on credit reports and how credit enquiries can show up on them.
Can I get a business loan with bad credit or an ATO debt?
It depends on the lane. On the property-secured lane, bad credit, defaults and ATO debt are considered, and overdue lodgements don't stop an application. On the cash-flow lane, the lender's current policy decides how credit history and tax debts are weighed. Our guides on bad credit business loans and loans with an ATO debt explain more.
How much can I borrow with a cash flow loan?
On the cash-flow lane, the loan is sized to the business's turnover. The amount depends on the lender's assessment, not on a set figure. On the property-secured lane, loans range from $20,000 to $5M and are assessed on equity in the property and the exit, meaning how the loan gets repaid. Borrowing more than a plan needs adds to repayments.
Do I need financial statements or tax returns to apply?
On the cash-flow lane, the core document is business bank statements, shared through a read-only link. The property-secured lane needs no financials or tax returns. If anything else is requested for a particular application, that depends on the lender's current policy. Having ABN details and online banking access ready makes the start smoother. This is general information only and does not take into account your objectives, financial situation or needs. All applications are subject to lending criteria, assessment and approval.
Does it cost anything to apply?
No. There's no cost to apply or check your eligibility. All costs are set out in writing in your loan offer before you sign anything.
Will checking my eligibility affect my credit score?
No. Our 60-second eligibility check doesn't make a credit enquiry. A credit check is only done later, with your consent, if you decide to proceed.
