Best Bad Credit Business Loans & Rates
Easily check your rates on business loans for bad of credit up to $500k.
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How Lend can help with a bad credit business loan
Access to specialists lenders
A lot of mainstream business lenders won’t offer finance to customers with bad credit, but we know the ones that do.

Key points about bad credit business loans
- Most lenders require a credit score minimum of 400
- Bad credit business loans have higher interest rates compared to standard business finance
- Only specialist lenders offer bad credit finance
- Bad credit loan terms are shorter (6 - 36 months)
- You may be able to use a property or other asset to secure the loan for better rates
Can I get a business loan with bad credit?
Yes, there are specialist bad credit loans available for business owners, sole traders and self-employed individuals who have defaulted on previous loans or have an adverse credit history.
There can be several reasons for having a lower-than-ideal credit score, including small dishonours, credit infringements, previous insolvency, or court judgments involving company directors. We can help you understand the issues in your credit report and how you can overcome them to get the finance you need.
In Australia, bad credit business loans are typically available for:
- People with credit defaults
- Businesses who’ve been previously declined for loans
- Companies who’ve experienced insolvency
- Discharged bankrupts
- Business directors involved in a Part IX debt agreement
- Business owners with an unsatisfactory credit history
- Businesses owners with a very limited credit history
Bad credit business loan explained
What is a bad credit business loan?
A bad credit business loan is a short-term loan suitable for borrowers with poor credit or who may not qualify for traditional business finance.
It’s no different to a standard small business loan, but comes with higher interest rates to reflect the added risk to the lender. Loan terms are generally shorter (6 - 36 months) and borrowing amounts are limited compared to standard small business loans or startup loans.

How are bad credit applications assessed
Your personal and business credit history
Lenders will use a credit reporting agency to check your personal and business credit score and history. This will show up any issues like late payments, collections, defaults and bankruptcies. It will also give the lender insights into any steps you have taken to improve your position.
Your business information
Lenders will look into your business trading history, revenue, and your reputation with customers and suppliers. This offers a view of the health of your business right now and its prospects for the future.
Character information
This may include a background check and character references to establish your trustworthiness.
Who is eligible for a bad credit business loan?
To be eligible for a bad credit business loan in Australia, you’ll need:
- An active ABN or ACN (sole traders and self-employed businesses can also qualify)
- At least six to 12 months of trading history
- Minimum monthly revenue of $10,000
- Bank statements and other financial documents to submit to the lender
- No current bankruptcy or other court judgments
Interest rates on bad credit business loans
Interest rates on bad credit business loans typically range from 15% to 35%. You may get a lower rate if you provide property as collateral (security) for the loan and are in a strong financial position currently.
That means lenders may also consider your trading history, revenue and your other liabilities. The loan purpose is important too. If you are purchasing an asset or hiring new staff to meet high demand for your business services (and can demonstrate this to the lender via signed contracts for work) lenders will view this favourably.
How to apply for a bad credit business loan
1
Find the right lender
Submitting loan applications with multiple lenders can make your credit score worse. Your Lend SME specialist helps you understand your eligibility with various lenders and decide on the one that is likely to offer you the best terms.
2
Prepare a business case
This should indicate how much you want to borrow and how you intend to use the funds to grow your business. Include (realistic) financial projections to show how much extra profit you can expect to generate, taking account of borrowing costs.
3
Submit supporting documents
To assess your trading history and cashflow, the lender will ask for documents that show you meet their criteria, including bank statements, ATO statement of account and notice of assessment, financial records and balance sheet, plus ID documents.
4
Get approved
A lending advisor may contact you to talk through your application and could ask you to supply additional information. Most online lenders will process applications fairly quickly and you could access funds within a few days.
More info about bad credit business loans
FAQs
Yes, most standard online lenders and banks will assess your personal credit score and business score when considering your loan application. However, specialist lenders place less emphasis on credit score and assess applications based on the strength of your business revenue. There are also alternative business finance options where your personal credit history is not as relevant to secure funding, including invoice finance, and merchant cash advance. Businesses who can't supply conventional documentation can apply for low doc loans.
You may still be able to get a line of credit if your credit history isn’t perfect. You may initially only qualify for a credit line secured against residential property or be asked to provide a personal guarantee. Personally-guaranteed credit makes you personally liable for the debt. You could alternatively apply for a bad credit business loan.
You can use a bad credit business loan for any genuine business activity, including for day-to-day capital, hiring, expansions, to purchase new equipment or business assets, etc.
With bad credit finance, lenders place more emphasis on ensuring the loan will deliver a clear revenue return that can support the repayments.
You generally don't need a deposit to get a bad credit business loan, although it can help you secure a better interest rate and increase your borrowing capacity. Alternatively, you could offer personal assets (or property) as security for the loan.
Yes, you can typically repay a bad credit business loan early. In fact we generally suggest businesses do this if cashflow allows as it can help improve your credit score. Be sure to check if early payment penalties (break costs) apply and whether the benefit of repaying the loan sooner (interest saved etc.) will be worth the additional costs.
In Australia, it’s extremely rare for lenders to offer no credit check business loans or bad credit business loans with guaranteed approval. Most lenders will assess your business credit history and that of its directors when you apply for a bad credit business loan.
Yes, specialist subprime lenders will consider applicants who’ve been discharged from bankruptcy in the last six to 12 months. Keep in mind interest rates on the loan will be higher to compensate the lender for the additional risk.
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