Hearing the words ‘interest-free’ is enough to grab the attention of many business owners across the country. And today, business lender, Moula will do just that with the announcement of its new payment platform, Moula Pay.
Moula Pay allows merchants like wholesalers or business equipment manufacturers, to provide pre-approved businesses the opportunity to purchase up to $250,000 worth of goods and services. Merchants are paid upfront by Moula, eliminating the pain of chasing down payments.
On the other side of the coin, businesses have 12 months to pay off their purchases and will enjoy the first three months totally interest-free. After that, 3% interest is charged per month against the outstanding amount. It’s hoped that this will improve cashflow for business customers.
Businesses will be able to use Moula Pay to:
- Purchase stock to sell to customers
- Buy business equipment to help your business grow
- Pay invoices without disrupting your cash flow
- Buy materials for pressing projects
“We know how hard it is for Australian businesses to access funding to support day-to-day operations and there’s opportunities on both sides of the merchant and business customer relationship with Moula Pay,” said Moula CEO, Aris Allegos.
“Merchants are able to outsource their credit management functions more cost-effectively than typically administering payment terms in-house. They’ve also opened the door to the significant pool of SMEs seeking to spend more on business purchases if they had additional funds and longer to repay.”
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According to a quarterly study by Moula of 500 business owners, 65% of businesses don’t pay merchants and suppliers on time, and 47% believe a buy now pay later option for business would help them manage cash flow.
Allegos believes Moula Pay will bridge the payment gap between businesses and their suppliers.
“We’ve evolved our data-driven business lending expertise creating Moula Pay to address SME payments pain points, effectively doubling support for good Aussie businesses by backing merchants and simultaneously getting behind their good business customers as well,” he said.
How do I sign up to Moula Pay?
First things first, in order to apply for Moula Pay, you’ll need to:
- Have an active Australian Business Number (ABN) or Australian Company Number (ACN)
- Accrue more than $5,000 in monthly sales
- Have been in business for at least 6 months
Then once you apply through the Moula website, the lender will assess your business within 24 hours and decide what credit limit they’re willing to offer you.
How do I use Moula Pay at checkout?
Just like using your business credit card! When you’re purchasing goods, simply select Moula Pay as your payment method. You’ll receive an instant notification to verify the payment each time you use Moula Pay and you need to do this before the purchase can be completed.
Moula then pays the Merchant directly, while you’ll have 12 months to repay your purchases.
Can I make additional repayments?
Absolutely! According to the Moula website, you’ll be able to “repay early at any time, with no penalty or charges”.
What fees does Moula Pay charge?
According to Moula, there are no fees for you to worry about when using Mould Pay. This includes set-up or establishment fees, direct debit fees, and penalty if you repay early. Moula also doesn't charge late payment fees, although you will be charged interest on the amount that's overdue for as long as it's overdue. There is also a $15 direct debit dishonour fee and repayment schedule fee.
Want to check out some other Moula lending products? You can find them by heading over to our business loan comparison tool.