Meet Prospa: The patron saint of business loans

Whether you’re looking to expand operations, jump on an exciting new business opportunity, or just make it through a period of low cash flow, a bit of extra funding can go a long way for your company.

But if your only experience getting a business loan is via the big banks, you’d be forgiven for thinking the process is drawn out and littered with more paperwork than you’d care to think about.

That’s where Prospa comes in. The online lender has taken the traditional approach to business financing and flipped it on its head, making it that much easier for business owners to get the funds they need, when they need them.

With a Prospa small business loan, you’ll be able to borrow as little as $5,000 or as much as $300,000, with loan terms ranging between 3 months and 2 years. And if you’re borrowing up to $100,000, you won’t have to worry about providing any security.

So if you’re after a loan to propel your business to new heights, Prospa could be a worthy contender for your list. But before you jump into things, you've probably got a few more questions you’d like answered. We cover some of the big ones below.

Who is Prospa?

Prospa is part of a new wave of digital lenders that’s using smart online platforms to take the hassle out of obtaining a business loan. Knowing full well that business owners have plenty on their plate already, Prospa streamlines the application process and promises a swift transferral of funds (so long as your business meets all of Prospa’s criteria).

This has been Prospa’s M.O. since it was established in 2011. In that time, it’s gone on to deliver over $1 billion in business loans across Australia and New Zealand, making it one of the more popular options among those seeking business financing.

What kind of loans does Prospa offer?

Prospa offers small business loans that are designed to be fast and flexible. As mentioned above, you’ll be able to borrow between $5,000 and $300,000, with simple interest rates between 9.90% and 26.50% for a 12 month term. And if you apply before 31 December, you’ll be able to take advantage of a six week repayment pause, to be used whenever it suits you.

Besides business loans, Prospa also offers an unsecured business Line of Credit. This is available to businesses that have been in business for at least 6 months and have a minimum revenue of $6,000 per month.

How fast is the application process?

Pretty fast. You’ll be able to apply for a business loan over the phone or online in as little as ten minutes. All you’ll need is your driver's licence number, your ABN, and your BSB and account number. If you’re borrowing more than $150,000, you’ll also need to have a few financial statements handy, like your profit and loss statement and cash flow. 

Prospa then uses smart technology to assess your application, with a decision typically taking just an hour to make. Assuming all the necessary boxes are ticked and your loan is approved, you can expect to receive your funds as early as the next business day.

What interest rate does Prospa charge?

When you take out a business loan with Prospa, you’ll receive a personalised interest rate based on a few factors, such as how long your business has been operating, the industry it’s in, and the revenue it brings in each month. As mentioned above, simple interest rates will be between 9.90% and 26.50% for a 12 month term.

That interest rate, along with any fees and charges, will determine how large your repayments will be. Don’t worry, all this will all be laid out for you at the beginning of your loan. As for payment frequency, you’ll be able to pay either daily or weekly, whichever works out to be more convenient.

What about fees?

One of the benefits of Prospa business loans is that there are very few fees on the table, and Prospa will be quite upfront about the ones that are. The main ones you’ll have to watch out for are the 3% upfront fee, the direct debit dishonour fee for any late repayments, and the rescheduling fee for every repayment made outside your agreed schedule.

Wondering how a Prospa small business loan stacks up against other offers on the market? Head over to our business loan comparison page, where you’ll be able to compare interest rates, fees, and features. And if you want to make sure you’re in the best possible position to secure funding, check out our guide to getting a business loan.