How to increase cash flow during the coronavirus outbreak

Low-cost and fast funding to keep your business up and running.

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Small businesses likely need to consider both short- and long-term solutions to cover operating expenses during the coronavirus outbreak. The government has announced that small- to medium-sized businesses will be able to receive cash payments of between $20,000 and $100,000 as well as government-guaranteed loans of up to $250,000 if they are affected by COVID-19. But you might also need to apply for more traditional financing to tide you over as you wait for these government applications to be processed.

9 ways to increase cash flow during the coronavirus outbreak

Business line of credit

A business line of credit gives you access to a credit limit that runs anywhere from $2,000 to $5 million in some cases. Rates can start at around 5% and go as high as 20%, depending on your business's financials and your credit score. Once you're approved, you can draw down on your line of credit as soon as the next business day.

This makes it ideal if you expect to need funding, but aren't sure how much or how long that need will last. It can be less expensive than a credit card in some cases. And it can cover a wider range of expenses, like rent and utilities.

Find a business lines of credit

Online business loans

Online business loans can get cash in your bank account as soon as the same day, depending on the lender. You can generally borrow between $2,000 and $1,000,000 with fees and rates differing between lenders.

Online loans can be faster and easier to qualify for than their bank counterparts. But they tend to come with higher rates than other loans. And some come with daily or weekly repayments, which can be inflexible if you're struggling with cash flow.

Compare loans for businesses affected by coronavirus

Find an online business loan today

Name Product Min. Loan Amount Max. Loan Amount Loan Term Upfront Fee Filter Values
Moula Business Loan
$5,000
$250,000
1 to 2 years
2% Establishment fee
A loan of up to $250,000 that can be approved and funded within 24 hours. Available to businesses with 6+ months operating history and $5,000+ monthly sales.
ebroker Business Loan
$5,000
$5,000,000
1 month to 30 years
$0 application fee
Small business loans available between $5,000 and $5,000,000. Get access to 70+ non-bank lenders on this independent platform.
Swoop Finance Business Loan
$1,000
$100,000,000
1 to 30 years
Depending on your loan contract
Apply online and borrow between $1,000 and $100,000,000. Options for good and bad credit borrowers.
Max Funding Unsecured Business Loan
$3,000
$30,000
1 month to 1 year
$0 application fee
An unsecured business loan from $3,000 that offers convenient pre-approval and no early repayment fees.
Lumi Unsecured Business Loan
$5,000
$300,000
3 months to 3 years
2.5% establishment fee
Apply for up to $300,000 from Lumi and benefit from short loan terms, no early repayment fees and once approved receive your funds in just one business day.
Valiant Finance Business Loan Broker
$5,000
$1,000,000
3 months to 5 years
$0 application fee
A Business Lending Specialist from Valiant Finance can give you access to competitive business loans from over 70 lenders. Loans between $5,000 and $1 million are available. Request a call – your loan can be funded in 1 business day.
OnDeck Business Loans
$10,000
$250,000
6 months to 2 years
3% of loan amount
Apply for up to $250,000 and receive your approved funds in one business day. Minimum annual turnover of $100,000 and 1 year of trading history required.
Heritage Bank Fully Drawn Business Loan
$20,000
No maximum amount
1 to 25 years
Application fee is available upon application
Get access to a loan from $20,000 with no maximum limit with Heritage Bank. Loans can be secured by residential and non-residential property and have terms of up to 25 years.
Prospa Business Loan
$5,000
$300,000
3 months to 3 years
3% origination fee
Small business loans are available from $5,000 - $300,000 on terms of up to 3 years. At least six months trading history and a monthly turnover from $6,000 is necessary.
ANZ Secured Business Loan
$10,000
$10,000,000
Up to 15 years
$600
Benefit from a low rate when you secure this loan with property and/or business assets. Loans from $10,000 available.
Westpac Business Loan
$20,000
$1,000,000
1 to 30 years
$0 application fee
Purchase a new vehicle, equipment or support your cash flow with a business finance solution from Westpac.
ANZ Unsecured Business Loan
$10,000
$1,000,000
Up to 15 years
$600
Apply for a loan from $10,000 with no security required and benefit from flexible repayment terms.
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Business credit cards

Most business credit cards come with benefits tailored to businesses, such as multiple cardholders and business reward points. But when you're in a cash flow crunch you need to focus on other features such as interest-free days and 0% purchase offers. Business credit cards tend to come with annual fees, so compare your options and find one with an annual fee that is manageable.

If you don't think you'll be able to pay off the balance in full before the due date, a loan or line of credit might be less costly, since they tend to have lower rates.

Name Product Bonus points Rewards points per $ spent Complimentary travel insurance Annual fee Minimum annual revenue
NAB Qantas Business Signature Card
100,000
0.66
No
$295
$75,000
Receive 100,000 bonus Qantas Points and earn points on everyday business purchases (including ATO payments). Up to 44 days interest-free. ABN required.
American Express Business Explorer Credit Card
100,000
2
Yes
$149
$75,000
ABN holders w/ $75,000 revenue. Get 100,000 bonus points when you spend $3,000 in the first 3 months. Ends 30 June 2021.
NAB Rewards Business Signature Card
100,000
1.25
No
$175
$75,000
Earn 100,000 bonus points when you spend $4,000 on everyday business purchases in the first 60 days of account opening. ABN required.
American Express Qantas Business Rewards Card
150,000
1.25
Yes
$450
$75,000
ABN holders w/ $75,000 revenue. 150,000 bonus Qantas Points and a $450 Qantas Flight Voucher when you spend $3,000 within the first 2 months. Ends 30 June 2021.
American Express Platinum Business Card
250,000
2.25
Yes
$1,750
$75,000
ABN holders w/ $75,000 revenue. Get 250,000 bonus points when you spend $8,000 in the first 3 months. Ends 30 June 2021.
American Express Business Card
N/A
1.5
No
$109
$75,000
ABN holders w/ $75,000 revenue. Up to 1.5 points/ $1 spent and extended cashflow with up to 51 days interest-free on business purchases.
American Express Gold Business Card
100,000
1.5
Yes
$169
$75,000
ABN holders w/ $75,000 revenue. Get 100,000 bonus points when you spend $1,000 within the first 2 months. Ends 30 June 2021.
American Express Velocity Business Card
100,000
1
Yes
$249
$75,000
ABN holders w/ $75,000 revenue. Get 100,000 bonus Velocity Points when you spend $3,000 within the first 2 months. Ends 30 June 2021.
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Business insurance claims

If you already have a business insurance policy, reach out to your provider to find out what's covered during a pandemic. You might be covered by business disruption as a result of infectious diseases, but most insurers have exclusions around disruptions from highly effective diseases and will not cover them. Coronavirus is now classified by the World Health Organisation as a pandemic, so business insurance will not cover you for any business losses.

Don't already have insurance? Starting a new policy now won't help – you won't be covered for events that happened before you had insurance.

Invoice factoring

Invoice factoring involves selling unpaid invoices from other businesses or government contracts at a discount to a factoring company. Typically, you receive between 80% and 95% of your unpaid invoice balance upfront, then the rest minus a fee as the invoices are filled.

Invoice factoring might be costly, but it could be easier to qualify for as eligibility depends on your clients and their invoices. It also doesn't involve debt repayments, which can hamper your business as it tries to recover from a loss in revenue.

Compare invoice factoring providers today

Name Product Min. Loan Amount Max. Loan Amount Loan Term Upfront Fee Filter Values
Timelio Invoice Finance
$10,000
$100,000,000
Up to 4 months
$0
Get up to 100% of the value of your invoices without having to wait for customer payments, and with no minimum turnover or operating history required.
ScotPac Invoice Finance
$10,000
$150,000,000
From 1 year
No set amount
Improve your business cash flow by financing your outstanding invoices. No minimum trading history required, but minimum 12 - month term and $10,000 in invoices.
ScotPac Selective Invoice Finance
$10,000
$1,000,000
1 to 3 months
$500
Finance your unpaid invoices on demand with terms of 1 - 3 months. 95% of invoice is paid upfront, with no minimum trading history required.
Octet Invoice Finance
$100,000
$10,000,000
1 month to 2 years
No Set Amount
Convert up to 85% of your company's receivables into cash flow. The value of your receivables need to be worth at least $250,000 to be eligible.
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What about invoice financing?

Invoice financing allows you to take out a loan using your business's invoices as collateral. You pay off the loan plus interest and fees, ideally as your clients start filling invoices.

This is usually less expensive than factoring. It allows you to choose which invoices to finance and receive up to 80–90% of the invoice within 24 hours. The remainder of the invoice will be transferred to you when the customer pays, minus a fee. But if your repayments mainly depend on clients filling their invoices on time, this option could set you up for default in a time when businesses are struggling to stay on top of their bills.

Government financing

If your business has been affected by coronavirus, you may be eligible for a payment of between $20,000 and $100,000 or a government-guaranteed loan of up to $250,000. To be eligible your business needs to have been negatively impacted by COVID-19 and you need to have an Australian Company Number (ACN).

You can find out what your business might be eligible for.

Negotiate with suppliers and creditors

Many lenders and credit card companies are waiving fees, deferring payments and offering other financial assistance to help businesses cope with the financial fallout of the coronavirus outbreak. But many of these are only available on a case-by-case basis, so you'll need to get in contact with their financial hardship department to learn what your options are.

Suppliers might also be willing to negotiate new payment terms to make sure they don't lose your business. But get in touch as soon as you can. Skipping payments without communication can hurt your relationship with your supplier and hurts its ability to run its business.

Cut back on expenses

Go over your business's balance sheet to see where you can cut back. Especially if you're paying for something that you no longer need if you have employees working from home. After you qualify for financing or see an uptick in revenue, you can start adding back programs if they make your business operations run more smoothly.

5 tips to manage your cash flow

These strategies can help you make sure you're getting the most out of your sales.

  1. Discount early payments. Provide an incentive for your clients to pay ahead of time by offering a discount. You won't bring in as much, but it could avoid the need for costly financing.
  2. Sell equipment you aren't using. Instead of letting old equipment sit around, turn it into a profit or trade it in if you're applying for financing and it's an option.
  3. Ask for a deposit on orders. To avoid that gap between receiving an order request and payment, ask for customers to provide a deposit of at least 50% on large orders. This can help cover production costs and avoid the need for financing.
  4. Negotiate costs and terms. When possible, give a counteroffer when ordering supplies or renegotiate the terms of payment to better fit your business's monthly cash flow.
  5. Offer subscriptions. A subscription can translate into more consistent revenue than one-off sales.

Bottom line

There's a chance you'll need to combine multiple types of financing to cover your operating costs during the COVID-19 outbreak since the low-cost options take a while to come through. But communicating with your creditors and suppliers right away is key – they might be able to adjust your repayments so you don't have to borrow as much.

Read our guide to business loans to find other options to apply for today.

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