Thinking of Starting a Business and Require a Business Loan? Here's What Lenders Will Want to See Before Saying Yes or No to Your Loan

So, you've got a killer idea, a solid work ethic, and the passion to finally turn your business dream into reality. First off congratulations. Starting your own business is no small feat (we know personally). But here's the kicker: unless you’re sitting on a pile of cash, you’ll likely need funding to get things off the ground.

Whether you're planning to launch a café, a construction company, gym, or a mobile beauty business, lenders want to know one thing before they hand over the money: Can you pay it back?

Let’s break down exactly what you’ll need to give yourself the best shot at getting that much-needed business loan—without the finance jargon.

Tip 1. A Clear Business Plan (Not Just an Idea in Your Head)

Lenders want to see more than just your passion—they want proof you’ve done your homework. Your business plan should cover:

• What your business is and who your customers are

• Your product or service offering

• How you’ll make money (pricing, revenue streams)

• Startup costs and operating expenses

• Marketing and growth strategy

• Cash flow forecast for at least 12 months

Pro tip: Even if you’re a one-person band, a solid plan shows lenders you’re serious, strategic, and prepared

Tip 2. Realistic Financial Projections

Numbers speak louder than words. Lenders will want to see:

• Projected income and expenses

• Profit and loss forecast

• Break-even analysis

• 12–24 months of cash flow projections

  
  

This helps them understand whether your business can afford the loan repayments, and how soon you'll be generating enough revenue to stay afloat.

Tip 3. Know your Personal Financial Situation

If your business doesn’t yet have trading history, you are the business—so lenders will look at your personal financial health, including:

• Personal credit score and history

• Assets and liabilities

• Any existing debts

• Bank statements (to show saving discipline and account conduct)

  
  

Tip: Clean up your credit and keep your bank account looking healthy. Pay bills on time, reduce debt where you can, and avoid unexplained withdrawals or overdrafts.

Tip 4. Skin in the Game (Your Own Contribution)

Most lenders will expect you to contribute something toward the setup—whether that’s cash, equipment, or sweat equity.

This is your “stake” in the game, and it shows lenders that you’re not just relying on them to take all the risk.

• Expect to front at least 15–30% of the startup cost, depending on the lender and industry.

• This can come from savings, family support, or asset-backed finance.

Tip 5. Collateral (Something to Secure the Loan)

Depending on how much you’re borrowing, lenders may ask for security. This could be:

• A personal guarantee

• A charge over business assets (equipment, vehicles)

• A second mortgage on property (if you're borrowing a larger sum)

• Caveat on property

  
  

Don’t have collateral? You may still qualify under unsecured business loan options, but interest rates will be higher and approval more selective.

Tip 6. Industry Experience (or a Team Who Has It)

If you're opening a café with zero hospitality experience, expect a few raised eyebrows. Lenders want to see that you or your team have:

• Prior industry experience

• Operational knowledge

• A relevant network or customer base

Tip 7. Trading History (If You’re Already Up and Running)

If your business has already started generating revenue, great! Lenders will want:

• Last 6–12 months of business bank statements

• GST returns and financial statements

• Details of existing debts or finance arrangements

  
  

This info helps them assess how well the business is tracking and whether you’re ready to grow.

Tip 8. A Funding Strategy (Not Just One Big Ask)

Don’t just ask for a lump sum—break it down:

• How much do you need and why?

• How will it be used? (e.g. $50k for a truck, $20k for marketing, $10k for fitout)

• What’s your repayment plan?

Clarity here helps build trust and confidence that you’re not flying blind with someone else’s money.

Getting a business loan isn’t impossible—but it does require preparation, transparency, and a bit of hustle.

Don’t wing it. 

Put the time in upfront to package your loan request properly, and work with someone who knows the lender landscape inside out (like a good commercial finance broker).

If you're ready to turn your business idea into reality but need a hand navigating the funding maze, we’re here to help. We speak fluent lender, and we’ll fight to get you the best deal with minimal stress.

Want help with your business finance plan?

Let’s make your business dream happen—together, lets chat