FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The Bibaringa Small Business Loans
Let me know about the Bibaringa Small Business Loans
Bibaringa unsecured loans provides amounts of between $5,000 and $100,000. The terms range between 3 and 24 months. They also offer cash flow-friendly repayments that are either per day or weekly.
What makes how is the Unsecured Loan different from an traditional company loan?
It is possible to apply to your Small Business Loan in under 10 minutes over the phone. You’ll get a same day response and the money could be available in just 24 hours. Traditional company loans are based on an interest rate per annum as well as other fees and charges. Our business loan is a pre-paid loan therefore you’ll be aware in advance of the total amount due, which includes the interest, fees and charges. This is then divided into a daily or weekly installment amount.
What could the Small Business Loan be used for?
The Small Business Loan can be used for nearly any business need, such as cash flow management, company renovations, marketing for purchasing inventory or new equipment, or as general working capital and much more. The loan is not available for personal reasons.
About larger Bibaringa Business Loans
What is the Larger Bibaringa Business Loan?
The Larger Business Loan is a larger amount of loan to help company expansion opportunities. Loans range from $100,000 to $500,000 with a term fixed for up to 36 months. Repayments are weekly or fortnightly depending on you cashflow.
How’s the Origination Fee calculated?
A Larger Business Loan has an Origination Fee which is calculated at 2.5% of the loan amount.
Am I eligible for the Larger Business Loan?
To be eligible for a loan in this amount, your business needs to be operating for at least three years with an annual turnover of at least $700K. Your company must belong to a New Zealand Citizen (or Permanent Resident) who is over the age of 18 and have a New Zealand company (with a valid NZBN/IRD) and be able of proving at minimum 12 months of business.
What can I use the funding for?
A large business loan can be used to fund almost every company need, including business remodeling, buying new equipment or inventory, as general working capital, and much more. The loan cannot be used to fund personal expenses.
Is the Larger Business Loan one that requires security?
Asset security is required for accessing funds over $150,000. This is in the form of a charge against assets, and could be registered through the PPSR or the registration of as a caveat.
A personal or director’s ensure is a commitment to repay credit that is generally in nature rather than specifying the security for a particular asset. The person who is signing the ensure is personally liable in the event that the company the borrower fails to re-pay the debt.
The Personal Property Securities Register (PPSR) is a central, national online register run by the New Zealand Government. It records security interests that have been which are registered with respect to personal property (including items or assets). The PPSR permits prioritisation over property that is personal to be assigned according to the date a security interest that is registered.
A caveat is a legal document lodged to offer the public notice of a legal claim against a property.
What is a pre-approval that does not require Credit Check?
If you’re applying for a Larger Business Loan of $250K or more we may be able to provide an initial pre-approval to make the process. It is possible to get this done without a credit check and within 6 hours of the initial application. This pre-approval is based on an initial evaluation that involves the answer to a series of financial well-being checks. It is not an offer of credit or guarantee of financing. The approval of a conditional loan is subject to an exhaustive credit evaluation, and any offer that you are offered could be based on different terms.
Application process
Can I be eligible for funding?
You are eligible to apply for an company loan if you
- are a New Zealand Citizen (or Permanent Resident)
- are over the age of 18 and own a New Zealand business (with a valid NZBN/IRD)
- you must prove at least 6 months worth of trade (for the unsecured loan $5K – $100K) or three years of trade (for the Larger Business Loan $100K - $500K)
How do I apply?
The application process is simple and simple. Just fill out the online application within a few minutes and a dedicated company credit specialist will contact you to guide you.
To be eligible for up to $100,000 you’ll require proof of identity (valid Driver’s License) and an active NZBN/IRD, and at least 6 months of bank statements.
For larger loan sizes, you’ll need:
$100K-$250K: Details of application, including credit consent, 6-12 months of bank statements, IRD statement (if you have a loan of more than $150K).
$250K – $500K: Information on the application including credit consent and 12 months of bank statements, IRD statement as well as the two most recent years’ financial statements, and interim financials for the current financial year such as age-related payables and aged Receivables reports.
How soon will I hear an answer?
For an unsecured loan ($5K up to $100,000) we can often provide a response in one hour if you apply during quality business timings and let us utilise the advanced bank verification system to instantly verify your bank details online. If you want to upload copies of your bank statements we can offer the decision within one company day.
If you are applying for a Larger Business Loan ($100K up to $500,000) we may be able to provide the conditional pre-approval within about six hours. Once you have signed the pre-approval document, you will need to wait around 2-3 days for final approval. However, this can be quicker based on the particular circumstances of each application. Some deals have been approved in less than 24 hours.
The most effective method for you to apply is make sure you apply during standard company hours, and allow us to use our advance bank verification link to verify your bank account information online. If you opt to upload the copies of bank statements it will take a little longer.
How soon will I receive the funds?
For the Small Business Loan ($5K or more) we typically offer a response in one hour – provided you make your application during normal business times and allow us to use the bank verification system link to instantly verify your bank information online. If you choose to upload copies of your bank statements we can offer an answer in as little as 1 business day.
For Larger Business Loans ($100K or more) we may be capable of offer you with a conditional pre-approval within six hours. After you’ve signed the pre-approval, the turnaround time is approximately 2-3 days to receive final approval, however this may be quicker depending on the particular circumstances of each application. Certain transactions have received approval within less than 24 hours.
The most efficient method would be to make sure you apply during standard business hours and permit us to use the advanced bank verification system to instantly confirm your bank details online. If you choose to send us duplicates of your banking statements, it can take a bit longer.
What’s the minimum amount I can borrow?
We offer the loan amount between $5,000 to $500,000. When you make an application for a certain amount, we look at a variety of elements to determine the well-being of the company and the extent of repayments your company will be able to support. The amount you receive from the loan will be determined by the specific circumstances the business.
When you apply for a particular amount, we look at a range of factors to determine how much we can lend you such as health of the business and the extent of repayments that your company is able to afford. The amount you receive from the loan will be determined by the particular circumstances of your company.
Fees & repayments
How much do you charge for a company loan?
When you apply for our business loan, we’ll assess the risk profile that you have for your business and offer you with a tailored offer that includes the amount of the loan, the duration and interest rates. A company loan is a loan that is priced upfront which means you know the exact amount to be paid, including any charges, interest rates or fees.
What is the basis for the rate I will be charged?
Business loan interest rates depend on several factors including the amount of money borrowed, the company assets the funds will be used for and the sector the company operates in, how long the business has been running for, how long the company has sufficient cash flow to cover the loan, and the general well-being and creditworthiness of the company.
What are the costs?
There aren’t any hidden charges with our business loans. You’ll be aware of the amount it is that you be required to pay and when, from the day you sign up. There’s no compounding and no extra fees (as long as you are able to make your payments punctually).
We don’t charge an application fee. You are able to get a cash loan without any upfront costs or obligation to proceed.
The Origination Fee includes the expenses associated with establishing and managing the loan. This is only a fee if you choose to proceed with the loan. The Origination Fee for us is 2.5 percent of the amount of the loan.
Can I pay out the loan earlier?
You may choose to pay back the entire amount of the loan in full at any time.
If you are deciding to do this please talk to one of our helpful business credit specialists. The professionals will provide you with the details of your repayment as well as an early payout amount. The figure will be calculated as the total of the remaining principal amount and any accrued interest at the time of early payout and 1.5 percent of the principal remaining as well as any outstanding fees.
How do repayments work?
In order to help you avoid missing payment dates and to align your cash flow schedule, we provide repayments either weekly or daily. These are automatically withdrawn from your designated company account.
Security & privacy
Will my information be protected?
The security of your personal information, as well as knowing how we collect the information we collect, use, share and secure your information, is of paramount importance and is a crucial aspect of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We employ industry-recognised encryption standards to secure your personal, sensitive and financial data and our funders are ISO 27001 certified for our dedication to customer security and security. We make use of an advanced bank verification system that allows you to instantly verify your bank account information online so we can provide quick responses.
About business loans
What is asset-based borrowing (a secured loan)?
An asset-based loan is when an business owner makes use of assets they own to make the funds for a loan. The asset may be a personal asset like the family home, or an business asset like a truck or piece of equipment.
The vast majority of the lenders including the banks with the biggest size, prefer to make loans secured by assets. If you have trouble paying back the loan, then the asset could be taken over by the lender. In essence, it is the process of securing new funding making use of the value of what you already own.
What do I need security for an business loan?
For loans that exceed $150K, no asset security is required before you can access the money However, we do require an individual guarantee. If you adhere to your loan obligations (as detailed in your loan contract), asset security is not needed. For loans of over $150,000 generally, there is a personal ensure and security that is in the form charges on assets.