What is the difference between a non-bank lender and a bank?

Non-bank lenders aren't traditional banks, meaning they don't hold banking licences or take customer deposits. Instead, they're private or specialist companies that provide finance directly to borrowers. With fewer regulations and more flexible lending criteria, non-bank lenders can often approve loans faster and cater to businesses that may not meet the strict requirements of a bank.

Are non-bank business loans safe?

Yes, reputable non-bank lenders operate under Australian consumer credit laws and must comply with responsible lending obligations. Before applying, check that the lender holds an Australian Credit Licence (ACL) and review their terms and conditions to ensure transparency around fees, rates and repayment options.

Do non-bank lenders check credit scores?

Most non-bank lenders will look at your credit score as part of their assessment, but they often place more emphasis on your business's cash flow, turnover and trading history. This makes them a good option for businesses with less-than-perfect credit, as they may still approve your application if your financial performance is strong.

How fast can I get a non-bank business loan?

Approval times vary, but some non-bank lenders can assess your application and fund your loan within 24 to 48 hours. The exact timeframe depends on the lender, the size of your loan and how quickly you can provide the required documents.

Can I get a non-bank business loan without collateral?

Yes, many non-bank lenders offer unsecured business loans, which don't require property or assets as security. These loans are typically based on your business's revenue and trading performance. However, unsecured loans may come with higher interest rates or shorter terms to offset the lender's risk.

Are interest rates higher with non-bank business loans?

Not always, but it can depend on the lender and your business profile. Non-bank providers often take on more risk than traditional banks, which can lead to slightly higher rates for some borrowers. However, the flexibility, faster funding and simpler approval process can outweigh the cost difference for many small businesses.

What documents do I need to apply for a non-bank business loan?

You'll generally need to provide details such as your ABN, business financial statements, bank statements, recent tax returns and ID verification for the business owner or directors. Some lenders may also ask for a business plan or cash flow forecast.

Can startups apply for a non-bank business loan?

Some non-bank lenders do offer loans for startups, although it may be more challenging if you don't yet have trading history or revenue. In that case, the lender may base its decision on your business plan, industry potential and the owner's personal financial position.

Can I refinance or consolidate debt with a non-bank lender?

Yes, many non-bank lenders allow you to refinance existing business loans or consolidate multiple debts into one facility. This can simplify your repayments and may reduce your overall costs if you secure a better rate or term.

What happens if I can't repay my non-bank business loan?

If you're struggling to make repayments, contact your lender as soon as possible. Many non-bank lenders can arrange temporary relief options, such as deferring payments or restructuring your loan. Ignoring the problem could lead to additional fees or damage your business's credit rating.

Can I repay a non-bank business loan early?

Most non-bank lenders allow early repayment, but check whether there are any early exit fees before you do. Some providers may charge a small fee to cover administrative costs or future interest, while others may let you repay early at no extra cost.

Elizabeth Barry

Journalist

Elizabeth Barry has over 10 years of experience in writing about various topics, with a focus on personal finance. Her words and commentary can be found in a range of outlets including the ABC, the Sydney Morning Herald, Mamamia, MSN, 7News, Singapore Business Review and The Irish Times. Elizabeth holds a Master of Arts (M.A.) in Creative Writing from the University of Technology Sydney, and a Bachelor of Arts in Communication, Social Inquiry from the same institution. Elizabeth has earned several nominations for awards and was Highly Commended as Best New Journalist at the 2017 Lizzies. Elizabeth began her career at Finder in 2013 as a journalist, gradually advancing through roles as senior writer, editor, senior editor, and ultimately lead editor, covering a wide range of personal finance topics until 2024.

Expertise

Banking
Personal finance
Investing

Experience

Moderator for the 2021 Intersekt Festival
Annual judge for Finder's Innovation Awards
Highly commended for Best New Journalist at The 2017 Samsung IT Journalism Awards

Education

Master of Arts (M.A), Creative Writing | University of Technology, Sydney | 2013-2014
Bachelor of Arts in Communications: Social Inquiry | University of Technology, Sydney | 2010-2012

Featured publications

Featured videos

5:22

Latest articles by Elizabeth Barry

204 articles written by this author

Personal Loans

Peer-to-Peer Personal Loans

The benefits of borrowing from a peer with the security of an established lender: This guide will take you through what you need to know about peer-to-peer lending in Australia, including who offers the loans.