Unsecured Business Loans
Unsecured Business Loans is a business funding pathway for Australian SMEs. It may suit businesses with a clear use of funds, current trading evidence and a realistic repayment source. It may not suit businesses using debt to cover unresolved losses or applying without documents.
Unsecured business loans may help SMEs access funding without offering a specific physical asset as security. They can be useful when speed, flexibility and a simple use of funds matter. But unsecured does not mean risk-free. The lender may still assess directors, bank statements, credit conduct, revenue, affordability and guarantees. Pricing may be higher than secured finance, repayment terms may be shorter and repayment frequency can affect cash flow. The right question is not “Can I get unsecured funding?” It is “Can the business afford this structure without turning a timing gap into a repayment squeeze?”
What is an unsecured business loan?
An unsecured business loan provides a business with funding without taking a specific physical asset as security for that loan.
That does not mean the lender takes no risk protections.
Depending on the lender and product, the business owner may still be asked for:
Unsecured lending is usually based more heavily on recent trading performance, cash flow and credit conduct.
- ✓ director guarantees
- ✓ business bank statements
- ✓ credit checks
- ✓ business identification
- ✓ trading history
- ✓ proof of revenue
- ✓ ATO or tax information
- ✓ repayment authority
- ✓ personal or business declarations
How unsecured loans differ from secured loans
Secured business loans:
Secured loans are backed by an asset such as property, equipment, vehicles, invoices or other collateral. Security may reduce lender risk and sometimes support larger amounts, longer terms or lower pricing. But the borrower risks losing the secured asset if repayments are not made.
Unsecured business loans:
Unsecured loans do not require a specific physical asset as collateral. They may be faster and more flexible, but because the lender has less security, pricing may be higher and repayment periods may be shorter.
Some unsecured loans still involve personal guarantees. Always check the contract.
Compare business loan rates and lenders in Australia
Filter by product, amount and security type to narrow suitable options.
Product type
| Lender | Product | Rate from | Amount | Term | Speed | Compare |
|---|---|---|---|---|---|---|
| Liberty | Liberty Business Loan Flexible criteria and sole traders | 7.95% - 17.45% | $10,000 - $350,000 | 1-7 years | 24-72 hours | Compare now |
| Prospa | Prospa Business Loan Fast unsecured working-capital access | 13.90% | $5,000 - $500,000 | 0.3-3 years | Within 24 hours | Compare now |
| OnDeck | OnDeck Business Loan Fast online unsecured lending | 15.00% | $10,000 - $250,000 | 0.5-3 years | 24-48 hours | Compare now |
Liberty
Liberty Business Loan
7.95% - 17.45%
$10,000 - $350,000 • 1-7 years
24-72 hours
Best for: Flexible criteria and sole traders
Compare nowProspa
Prospa Business Loan
13.90%
$5,000 - $500,000 • 0.3-3 years
Within 24 hours
Best for: Fast unsecured working-capital access
Compare nowOnDeck
OnDeck Business Loan
15.00%
$10,000 - $250,000 • 0.5-3 years
24-48 hours
Best for: Fast online unsecured lending
Compare nowRates shown are publicly advertised starting rates and ranges where available. Your actual rate depends on lender assessment, security, turnover, time in business, credit profile and loan structure. Updated 10 May 2026.
Why non-bank lenders often appear in unsecured lending
Many online and non-bank lenders focus on faster unsecured or low-document business lending.
They may assess recent bank statements, monthly turnover, cash-flow conduct and business performance rather than requiring long paperwork packs or property security.
This can help some SMEs that are viable but do not fit a bank’s secured lending model.
However, speed and flexibility can come at a cost. The comparison should include:
- ✓ total amount repayable
- ✓ interest or factor rate
- ✓ fees
- ✓ repayment frequency
- ✓ term
- ✓ default consequences
- ✓ guarantee obligations
- ✓ early repayment rules
When unsecured funding may fit
Unsecured business loans may suit situations such as:
They may be attractive where the business owner does not want to offer property security or where the funding need is not tied to one asset.
- ✓ short-term working capital
- ✓ materials for a confirmed job
- ✓ stock purchases
- ✓ marketing or growth campaigns with a clear plan
- ✓ equipment plus installation costs
- ✓ minor fitout costs
- ✓ supplier payments
- ✓ cash-flow timing gaps
- ✓ bank-decline alternatives
- ✓ urgent but commercially justified opportunities
When unsecured funding may not fit
Unsecured funding may be a poor fit if:
A fast unsecured loan can feel like relief. It can also become the next pressure point if the repayment rhythm does not match the business.
- ✓ the business cannot afford frequent repayments
- ✓ the use of funds is vague
- ✓ the loan is being used to cover ongoing losses
- ✓ the amount needed is too large for unsecured criteria
- ✓ the business has unresolved tax or legal issues
- ✓ the owner assumes “unsecured” means no personal risk
- ✓ a cheaper secured or asset-backed product is available and suitable
- ✓ repayment would depend on speculative future revenue
Speed vs cost trade-off
Unsecured loans can sometimes be assessed more quickly than traditional secured finance because there may be less asset valuation and security documentation.
But faster assessment does not automatically mean better funding.
Ask:
- ✓ Why is this product faster?
- ✓ What cost am I paying for that speed?
- ✓ How often are repayments taken?
- ✓ What happens if the business has a slow week?
- ✓ Is the loan amount proportionate to monthly revenue?
- ✓ Is this a short-term bridge or a longer-term need?
- ✓ Would invoice finance, equipment finance or a line of credit fit better?
Eligibility basics
Lender criteria vary, but unsecured business lenders may consider:
Businesses with strong recent revenue, clean bank conduct and a clear use of funds may have more options.
- ✓ ABN
- ✓ trading history
- ✓ monthly revenue
- ✓ business bank statements
- ✓ GST registration
- ✓ director credit profile
- ✓ existing debt
- ✓ industry type
- ✓ tax position
- ✓ bank account conduct
Repayment frequency matters
Unsecured loans may require daily, weekly, fortnightly or monthly repayments.
The repayment schedule should match the business’s revenue rhythm.
Daily repayments may suit some businesses with daily takings, but they can strain businesses that collect revenue monthly or through irregular invoices. Weekly repayments may be manageable if cash inflows are weekly. Monthly repayments may be easier to plan for some SMEs, but not every facility offers them.
Do not compare loans only by amount approved. Compare how repayments behave.
Red flags to check
Before accepting unsecured business funding, check for:
ASIC’s unfair contract term guidance is relevant because small businesses commonly enter standard form contracts for financial products, including business loans. If terms look one-sided, seek advice.
- ✓ unclear total cost
- ✓ confusing factor rate
- ✓ high establishment fees
- ✓ mandatory daily repayments that do not match cash flow
- ✓ personal guarantees you do not understand
- ✓ default fees
- ✓ short terms that increase repayment pressure
- ✓ automatic renewal traps
- ✓ pressure to sign quickly
- ✓ vague lender identity
Comparison One fit-first checklist
Before applying for an unsecured business loan, answer:
- ✓ What is the exact use of funds?
- ✓ How much is needed?
- ✓ Why is unsecured funding preferred?
- ✓ Is speed more important than cost?
- ✓ What repayment frequency can the business handle?
- ✓ Could an invoice, equipment or secured product fit better?
- ✓ Are director guarantees involved?
- ✓ Is the total amount repayable clear?
- ✓ What happens if revenue is delayed?