Thinking of starting your own business or need a cash injection in your existing business. Our small business loans are easy to apply for online with an answer normally within 24 hours.
Small business loans from $5,000 to $30,000 and for that more expensive equipment and funding purposes up to $100,000.
At Loansmart we make small business loans easy, helping you to move forward.
- Apply online in less than five minutes
- Finance rate tailored to your individual circumstances
- Customer focus – you will have a dedicated lending consultant.
Many small business owners obtain small business loans at one time or another, but that doesn’t mean it’s always the right decision.
Generally speaking, taking out a loan is reasonable if you:
- need the money to grow, rather than as a bailout
- are confident you can make repayments on time, every time
- understand all the terms and conditions.
Common Mistakes with Small Business Loans
- Obtaining small business loans without, or inaccurately, forecasting your income.
- Not understanding the terms and conditions of your loan, or the interest rate you’ve agreed to pay.
- Getting a loan and spending up large — it might feel like easy money, but have a plan for what to spend it on.
- Not having a plan in place to pay back your loan — it’s important to budget for regular repayments.
Introduction to Business Finance
Finance is about managing your money — knowing what’s coming in and going out. Check out our jargon-buster: B is for budget, C is for cash flow.
By understanding your business finances, you can make smart decisions about where to spend your money and make sure you’re earning enough to keep your business running.
A big part of managing your finances is having visibility of what’s going on in your business, whether you’re a sole trader, or in a partnership or company. The key tools and reports to manage your finances are:
1. Cash flow
Your cash flow is the money coming in and going out of your business — and how much of the money sitting in your bank account is yours to spend. Healthy cash flow is having enough money to pay what you owe when it’s due.
A budget is an estimate of your income and spending over a period. It helps you think ahead and plan your spending to get to where you want to go. Using small business loans when cash flow is tight can be a good decision.
3. Profit and loss statement
Your profit and loss statement is an accounting report that shows your income and expenses — and whether you made a profit or loss — over the financial year. It may also be known as the income statement.
4. Balance sheet
The balance sheet is an accounting report that shows what you own and what you owe at the time of the report. It’s known as the ‘snapshot’ of your business’s financial position.
Why Manage Your Business Finances
By staying on top of your finances you can:
- understand how your business is performing
- make informed decisions about your spending
- make sure you have enough money in the bank to pay the people you need to when you need to
- stay on top of your tax payments (our small business loans can be used to pay tax bills)
- provide accurate information to get investment or a business loan
- set and achieve key business milestones — like expanding into new areas, or hiring someone new.
Tips to Manage Your Finances
- Keep accurate records and check them regularly
- Use a separate business bank account to keep a clear record of the money coming in and going out of your business
- Put aside a portion of your income into a savings account to cover your taxes and levies
- Set a budget and compare how you’re actually going against the budget every month to make sure you’re on track.
Avoid these common mistakes to keep your business finances on track:
- Not having access to records that can help you understand your finances.
- Spending the money in your bank account, not realising it’s needed to cover bills.
- Not putting away money as you go to cover your taxes and levies.
- Invoicing late, and not chasing up debtors — this has a huge impact on your cash flow.
- Not getting advice when you need it, or trying to do it all yourself.
For more valuable tips in business visit business.govt.nz, a government web-site packed full of resources.