Business Overdrafts
Access additional funds directly from your business transaction account to manage your business cash flow or unexpected expenses.
Should I consider a business overdraft?
An overdraft is essentially a line of credit attached to your business bank account, which allows your business to draw on money (up to an approved limit) beyond what you currently have in your account. The business will then only need to pay interest on the amount of money they’ve overdrawn, making it a useful cash flow solution in many situations like purchasing stock or equipment, paying staff, or even covering general expenses.
How an overdraft can help your business
Many businesses take advantage of business overdrafts. Interest rates for this type of finance are always variable. Overdrafts can be secured by property or even unsecured. Securing an overdraft with property comes with benefits, such as a reduced interest rate, a greater loan limit and favourable loan terms. Some businesses only require small unsecured business overdrafts where pricing on interest rates and fees are higher, although it is more important to have access to funds and flexibility.
Business overdrafts are for businesses that:
- Want the convenience of extra funds linked directly to their transaction account
- Need to borrow $2000 or more
- Need to cover cash flow shortages and unexpected expenses
Secured vs Unsecured Business Overdrafts
As a business, you can choose whether to secure or leave your overdraft unsecured. Securing your overdraft means committing a range of assets (such as residential, commercial, and industrial property) to give you a line of credit.
Choosing an unsecured overdraft means you may incur a higher interest rate, as nothing is held against your loan. However, it does expose you and your business to a lot less risk than a secure overdraft.
At Inovayt, our acclaimed Business Finance Professionals will find you the most appropriate solution and lender.
What our clients say
What are the benefits of a business overdraft?
Business overdrafts have a multitude of benefits, including:
- Acting as a safety net for when you quickly need access to additional funds.
- Flexible term limits you can discuss and negotiate with your lender.
- Keeps cash flow consistent during unexpected situations and tough sales periods.
- Your choice of secured or unsecured overdraft.
If you want more information on business overdrafts and if they’re the right option for your business, talk to one of our team members today.
Helpful resources
Financing your business
Invest time into your business finances. Our business finance guide unpacks everything you need to know about financing your business.
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Our team of experienced commerical brokers help you discover the right financial solutions for you and your business, so you can put your business in the best possible situation to grow, while having piece of mind.
Our team of experienced commerical brokers help you discover the right financial solutions for you and your business, so you can put your business in the best possible situation to grow, while having piece of mind.
Our team of experienced commerical brokers help you discover the right financial solutions for you and your business, so you can put your business in the best possible situation to grow, while having piece of mind.
Our team of experienced commerical brokers help you discover the right financial solutions for you and your business, so you can put your business in the best possible situation to grow, while having piece of mind.
