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What Lenders Really Look For: A Practical Guide for ABN Holders Applying for Business Finance

Posted By: Sylvia Flores - Senior Commercial Finance Writer at B.K Brokers | Date: 26/05/2025 5:34:49 AM

If you’ve been operating a business with an ABN for at least six months and are ready to take the next step in your growth journey, chances are you’ve considered applying for finance. Whether you need a new vehicle, updated equipment, a boost in working capital, or even commercial property — securing the right loan can be a game-changer.

But many business owners go into the application process blind, unsure of what lenders are actually looking for. That’s where this guide comes in.

At B.K Brokers, we help Australian businesses every day to navigate the commercial finance landscape. We know what funders prioritise, what pitfalls to avoid, and how to position your application for the best chance of approval. And if you’re still unsure what type of loan is right for you, start with our Ultimate Guide to Commercial Finance in Australia — a cornerstone blog that breaks down all your options in plain English.

Let’s dive into what lenders really want to see — and how you can prepare like a pro.

Why Lender Expectations Matter

Lenders aren’t just looking at whether you can borrow — they’re assessing how likely you are to repay. Knowing their criteria gives you a huge advantage. It’s not just about ticking boxes — it’s about telling a clear, credible financial story.

Many applications are rejected not because the business isn’t viable, but because:

  • The paperwork was inconsistent or incomplete

  • The applicant didn’t understand the lender’s risk appetite

  • They applied for the wrong type of finance

By taking the time to align with lender expectations, you reduce the risk of rejection, avoid credit file damage, and often unlock better rates and terms.

The Essentials: Minimum Criteria for Business Finance in Australia

While every lender is slightly different, most reputable funders — banks, fintechs, and private lenders alike — will start by looking for:

1. ABN Trading History (Minimum 6 Months)

Most lenders want to see that your business has been trading under an active ABN for at least 6 months. Some unsecured loan providers may work with businesses under 12 months old, but most asset and commercial property finance lenders require at least 12–24 months.

Tip: If you’re a sole trader or contractor, your personal credit file may also be assessed alongside your ABN.

2. GST Registration

For loans above $50,000, being registered for GST is typically required. GST registration demonstrates that your business meets the $75,000 turnover threshold and is operating at a meaningful scale.

3. Business Revenue

Monthly turnover is one of the key factors lenders consider. For unsecured loans, many lenders require a minimum of $5,000–$10,000 in monthly revenue, with some preferring more. For secured finance (like vehicle or equipment loans), revenue requirements vary depending on deposit, asset type, and term.

4. Bank Statements & Financials

Be prepared to provide:

  • Last 3–6 months of business bank statements

  • BAS (Business Activity Statements)

  • Profit and Loss or basic financials

This helps lenders assess your cash flow consistency and determine whether repayments are manageable.

Beyond the Basics: What Really Moves the Needle

Understanding the core eligibility is one thing. But if you want to increase your chances of fast approval and potentially unlock better loan terms, here’s what lenders look for at a deeper level:

1. Consistent Cash Flow

Lenders love consistency. Large one-off deposits followed by dry spells can raise questions. Aim to demonstrate stable income month over month. If you’re seasonal, it helps to explain that in your application.

Broker Insight: When applying through B.K Brokers, we help present your cash flow story clearly and positively — especially if there are seasonal patterns or irregularities.

2. Separation of Business and Personal Finances

Mixing personal and business income in the same bank account is a red flag. It’s confusing for lenders and makes your revenue harder to verify. Ideally, use a dedicated business account linked to your ABN.

3. Low Credit Enquiry Activity

Every time you apply for credit, it leaves a mark. Multiple applications in a short timeframe can damage your business credit profile — and signal desperation to lenders

Avoid this mistake: Don't shotgun your application to 10 lenders at once. It hurts your credit score and reduces approval odds.

Work with a broker like B.K Brokers who can assess your situation and submit to the most suitable lender first time around.

4. Clear Purpose for the Funds

Be prepared to explain:

  • What you’re borrowing for

  • How it will help your business grow

  • How you’ll repay it

Even for unsecured business loans, a clear and commercial use of funds builds confidence with the lender.

How to Improve Your Approval Odds: Practical Tips

Keep BAS and Tax Lodgements Up to Date

Lenders check your ATO position. If you have outstanding BAS or tax debts, it could hurt your application. Keep your lodgements up to date, even if you can’t pay in full — showing compliance is critical.

Reduce Outstanding Debts Where Possible

If you have existing loans or maxed-out credit cards, consider paying them down before applying. Debt-to-income ratio is a major approval factor.

Prepare a Basic Business Plan (for larger loans)

If you're seeking more than $250,000 or looking at a commercial property loan, a simple business plan or forecast can go a long way. It doesn’t need to be fancy — just show how the loan supports growth and how you plan to repay.

Common Mistakes That Trigger Rejections

  • Submitting incomplete information (missing bank statements, mismatched ABN details, etc.)

  • Applying for the wrong product type (e.g. unsecured loan when asset finance would be a better fit)

  • Using inflated revenue numbers without proof

  • Not engaging a broker — direct applications to banks or fintechs often mean you’re missing out on alternatives

Loan Types with Different Approval Pathways

Unsecured Business Loans

  • Fastest approval (often within 24–48 hours)

  • Based on turnover, time in business, and credit score

  • No property security required

  • Ideal for working capital, short-term needs

Asset Finance

  • Medium-speed approval (1–5 days)

  • Secured against the asset itself (vehicle, equipment)

  • Lower interest rates than unsecured options

  • Good for tax-effective acquisitions

Second Mortgages / Private Lending

  • Suitable for businesses with equity in property but lacking other security

  • More flexible criteria, but higher interest

  • Often used for short-term or “urgent” scenarios

Commercial Property Loans

  • Longer approval timeline (2–4 weeks)

  • Requires property valuations, financials, and strong serviceability

  • Better rates and longer terms

  • Ideal for established businesses looking to invest or expand

For a full breakdown of these loan types and how they compare, see our Ultimate Guide to Commercial Finance in Australia.

What Lenders Look for in New ABN Holders

If you’ve been operating for just over 6 months, you’re in a grey area — many banks still won’t touch you, but specialist lenders may. Here’s how to improve your case:

  • Provide all trading data (invoices, bank statements)

  • Show strong revenue trajectory

  • Keep credit file clean

  • Demonstrate demand for your services

B.K Brokers has access to non-bank lenders who support newer businesses — especially if you’re in high-demand industries like construction, logistics, or healthcare.

How a Broker Adds Value

Trying to secure finance on your own can feel like trial and error. With over 40 lenders on our panel, we don’t just “apply and hope” — we strategically match your business to the right lender based on your history, industry, and goals.

Our job is to:

  • Package your application professionally

  • Minimise rejection risk

  • Negotiate better rates and terms

  • Save you time and stress

Ready to Apply with Confidence?

If you’re an ABN holder ready to grow your business but unsure where to start, let us guide you.

At B.K Brokers, we offer:

  • Transparent, obligation-free finance reviews

  • Real advice on your borrowing position

  • Fast access to unsecured loans, asset finance, and commercial funding

  • Human-first service, every step of the way

Don’t leave your application to chance — speak with a broker who puts your business first.

Contact us today for a no-obligation finance readiness check and explore your real funding potential.

Tags: how to get approved for business finance, business loan eligibility Australia, unsecured business loan eligibility, finance for new ABN holders, what do lenders look for in business loans, ABN business finance tips, commercial loan approval checklist, sma

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