Small Business Lender Review - Prospa
Overview
Prospa understand that growth opportunities and unexpected challenges pop up when you’re running a business, and that timing can be critical.
They offer award-winning business loans of between $5,000 and $250,000, with cash-flow friendly payments and the possibility of funding within just 24 hours.
Prospa have supported more than 12,000 Australian SMEs with more than $500 million in small business loans.
Features
- Short-term loan you can use for any business purpose
- $5,000 and $100,000 unsecured, up to $250,000 secured
- Flexible repayments – monthly or weekly to suit your cash flow
- Fast application – funds could be in your account within 24 hours
- No penalty for early repayment
- Interest cost fixed up-front
Summary
| Name | Prospa Business Loan |
|---|---|
| Min Loan Amount | $5,000 |
| Max. Loan Amount | $300,000 |
| Minimum Loan Term | 3 months |
| Maximum Loan Term | 24 months |
| Loan Security | No asset required up to $100,000 |
| Interest type | Simple interest rate |
| Repayments | Weekly or monthly |
Qualification criteria
| Type | Criteria |
|---|---|
| Minimum turnover | $6,000 per month |
| Minimum trading period | 6 months (3 if you’ve purchased an existing business) |
Cost
Because most of their small business loans are for less than 12 months, Prospa use a factor rate rather than an interest rate to calculate the cost of your loan.
This means your interest will be calculated up-front as a multiple of the amount you borrow. The factor rate will depend on many factors including how much you want to borrow, the term of the loan and the perceived risk level.
You’ll also be charged an establishment fee for the loan. Both this and your interest will be added to your loan balance and repaid as part of your monthly or weekly instalments.
There are no fees for early repayment. However, if you fall behind on your payments or default on your loan you will incur penalties.
How to apply
Prospa has a fast, simple online application process, which should take no more than ten minutes.
For loans up to $50,000, all you need to provide is:
- Your driver licence number
- Your ABN
- Your bank statements (last 3 months)
- Your BSB and account number.
For loans over $50,000, you’ll also need to provide some basic financial statements, like a P&L and cash flow.
You can choose between using Prospa’s advanced bank verification system or uploading PDFs of your last 3 months’ transactions. If you use their bank verification system you could have a response within as little as an hour – otherwise you can expect a response the next business day.
If you apply before 4pm on a business day, and your application is approved, you could have the funds in your account the same or next business day.
How Does Prospa Compare?
| Lender | Product | Term | Loan Range | Interest Type | Fees | Security | Repayments |
|---|---|---|---|---|---|---|---|
|
Prospa Business Loan | 3 – 24 Months | $5k – $300k | Simple interest rate | Establishment fee | No asset required up to $100k | Weekly or fortnightly |
 |
Spot On Business Loan | 1 – 24 Months | $10k – $250k | Percentage, but only on balance drawn | Drawn on fee (% of credit limit) | Unsecured | Weekly, fortnightly or monthly |
 |
GetCapital Flexible Business Loan | 6 – 24 Months | $5k – $500k | Percentage | 2% Draw down fee, plus $3.85 direct debt fee per week | Unsecured | Weekly |
 |
Flexible Business Loan | 6 – 24 Months | $5k – $500k | From 0.87% per month | 2% Draw down fee, plus $3.85 direct debt fee per week | Unsecured | Weekly |
 |
OnDeck Small Business Loan | 6 – 24 Months | $10k – $250k | Percentage | Establishment fee of 2.5% | Unsecured | Daily or weekly |
 |
Beyond Merchant Capital Unsecured Business Loan | 9 – 12 Months | $10k – $500k | Factor Rate | None | Unsecured | Daily or weekly |
 |
Moula Business Loan | 6 – 12 Months | $5k – $250k | 0.75% to 2% per fortnight | None | Unsecured | Fortnightly |
 |
Business Fuel Business Loan | 3 – 18 Months | $5k – $250k | Factor Rate | None | Secured or Unsecured | Weekly or monthly |
 |
Max Funding Business Loan | 1 – 36 Months | $2k – $1m | From 1.5% per month | Fees are laid out in loan agreement | Secured or Unsecured | Weekly or tailored |
