Startup business loans

Can I get a startup business loan?

If you're just starting up your business, it might be difficult to get a business loan. It's possible though.

Typically you need to have started your business already and be able to demonstrate business revenue. Some lenders require you to have been in operation for at least 2 years, but others only ask for as little as 6 to 12 months.

There are lenders which have no requirements around your time in business or annual turnover, but you may need to demonstrate the strength of your business idea. You may also end up paying higher interest rates.

You'll need to check each lender's criteria to know whether or not you're eligible.

What can I use a startup business loan for?

There are several reasons why a startup business may need finance and it'll be different for each business.

In general though, here are some reasons you might be needing funding:

• To develop the product/service. This is one of the most common funding needs for startups. Developing the initial business idea into a market-ready product or service is expensive, and generally happens at a time when the business has no revenue.
• For operational expenses. Startups often need to hire staff, lease business space such as coworking space and pay the salaries of staff and founders. This requires funds, and the larger the business and the more staff that are hired, the more funds the startup will need.
• To market the product. Acquiring customers is a common startup hurdle, and marketing is generally your best option. Whether it's online, through social media or using an old-school letter drop, these activities need time and money.
• To expand the business. This is a positive step forward for any startup – expanding the business. Due to the uncertain cash flow in startups, it's common to use external funds to expand.

What types of funding options are available to startups?

Startups have little to no internal funds – that is, profit. Because of this, these companies have a choice between two types of finance: debt finance or equity finance.

Debt finance: This involves borrowing money, so the business takes on debt.

Equity finance: This involves the business acquiring funds from investors or a public float in return for a share of the company.

Here are some options startups have when it comes to debt and equity finance.

Debt finance

• Loans from traditional lenders

Banks and credit unions offer loans to people looking to start small businesses. The application process usually requires detailed business plans and you may need to put up security.

• Loans from online and alternative business lenders

The number of online and alternative business lenders has increased in the last few years. You can apply for business loans online and receive funding quickly, sometimes within 24 hours.

• Business credit cards

If you only need a small loan or require access to an ongoing line of credit, a credit card may be an option to consider. You can opt for a card that gives you 0% interest p.a. on purchases for up to 12 months.

Equity finance

• Angel investors

These are individual investors who help to finance your startup, usually in exchange for a partnership stake. You can find these individuals yourself or through startup hubs, meetups or investment groups.

• Venture capitalists

This is a specific type of equity capital that involves individuals or venture capital firms providing funds for startups and early-stage businesses. Your business needs to demonstrate potential revenue and a solid business strategy.

• Public float

This involves you listing your company on the stock exchange so that people can purchase shares. Keep in mind that doing this will involve a higher degree of transparency with your business than if you remain a private company.

How to compare startup loans

Finding the right finance for your new company is important, and it all starts with comparing your options. Here are a few points to keep in mind:

How much do you need to borrow?

You'll be offered a loan based on the details you provide in your application. But often you can at least see the minimum and maximum amounts on offer, depending on the lender.

How long do you need to repay the loan?

Different loan terms will change how much your monthly repayments are. The longer your loan term, the lower your repayments will be. But you'll pay more in interest.

How much can you afford?

It may be difficult to determine how much you'll be able to repay if your business isn't off the ground yet, which is where having a sound business plan comes into play. Work out an approximate budget and don't apply for a loan you can't afford.

Do you need access to ongoing credit or a lump sum amount?

Will you need continued access to finance? Consider whether an ongoing line of credit or a loan that offers a redraw may be a better option for you. Remember to take your repayments into account when budgeting your startup financials if you opt for a lump sum loan.

Our expert says: Can't get a loan? Look at grants

"If you're looking to start a new business but need funding to get off the ground, you might want to look at grants that are often available. States will have their own support available for new businesses.

For Centrelink recipients wanting to start a new business they might be able to benefit from NEIS assistance."

Rebecca Pike

Editor, Money

How long does my business need to be in operation for a startup loan?

These are the criteria for lenders featured on Finder in regards to how long your business needs to have been in operation for:

Loan sorted? Learn about your insurance options.

What if I own an early stage business?

An early stage business is generally one in its first year of operation, but has progressed past the initial startup phase.

However, early stage business owners face similar issues to startups when it comes to getting finance. If you don't meet the minimum turnover and trading history requirements of a particular lender you are unlikely to be approved for a loan, regardless of how promising your business is.

You should instead consider finance from lenders with no minimum business requirements, or look into alternative finance options, such as invoice finance or a business line of credit.

Frequently asked questions

• Do I need to be trading for a minimum period to get a startup loan?

  Yes, most Australian lenders require at least 6 months of trading history and an active ABN before you can qualify for a business loan. While some specialist fintechs may consider 3 months of history, traditional banks often require a minimum of 12 to 24 months of established performance.

• Can I get a startup business loan with no revenue?

  No, standard business lenders typically require a minimum monthly turnover of $5,000 to $10,000 to verify that your business can service the debt. If your startup has not yet generated revenue, you may need to explore alternatives like personal loans for business purposes, government grants or equity investment.

• Will I have to sign a personal guarantee as a startup director?

  Yes, almost all unsecured startup loans in Australia require a personal guarantee from the company directors. This legal commitment means the director becomes personally liable for the debt if the business is unable to make its repayments, which can put personal assets like the family home at risk.

• Is a formal business plan mandatory when applying for a startup loan?

  No, a formal business plan is not always mandatory for online fintech lenders who use bank feed data, but it is a standard requirement for major Australian banks. Providing a detailed plan that outlines your revenue projections and market strategy can significantly improve your chances of approval with traditional financial institutions.

• Are interest rates higher for startup loans than for established businesses?

  Yes, lenders typically charge higher interest rates for startup loans because new ventures represent a higher risk of default than established companies. According to the RBA's lending rates data (Table F7) for the July 2026 reference month, small businesses paid about 1.9 percentage points more per year on new loans than large businesses.

• Can I use my car or existing equipment as security for a startup loan?

  Yes, using assets like vehicles, machinery or equipment as collateral is a common way for startups to secure finance via a chattel mortgage. This method often results in lower interest rates and higher approval chances because the asset reduces the lender's risk.

Written by

Elizabeth Barry

Journalist

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Elizabeth Barry is an experienced journalist with over 10 years of expertise in personal finance, contributing to outlets like the ABC, Sydney Morning Herald, and 7News. She holds a Master of Arts in Creative Writing and a Bachelor of Arts in Communication from the University of Technology Sydney, and has earned multiple award nominations, including a Highly Commended recognition at the 2017 Lizzies. Elizabeth began her career at Finder in 2013, progressing through roles to become Lead Editor, where she oversaw a wide range of personal finance coverage until 2024. See full bio

Elizabeth's expertise

Elizabeth has written 155 Finder guides across topics including:

• Banking
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