Frequently Asked Questions
About the Prospa Small Business Loan
Prospa‘s Small Business Loans offers amounts between $5,000 and $100,000 with terms between 3 and 24 months and cash flow friendly repayments that are either daily or weekly.
You can apply for the Prospa Small Business Loan in under 10 minutes online or over the phone, receive a same day response and the funds could be in your account in 24 hours. Traditional business loans reference an interest rate per annum plus other fees and charges. The Prospa business loan is an upfront priced loan so you will know in advance the total amount payable including any interest, fees or charges. This is then broken down into either a daily or weekly repayment figure.
A Prospa Small Business Loan can be used for almost any business purpose including cash flow management, business renovations, marketing, to purchase inventory or new equipment, as general working capital and much more. The loan cannot be used for personal purposes.
About the Prospa Plus Business Loan
The Prospa Plus Business Loan is a larger loan size to support business growth opportunities. Loans are between $100,000 and $500,000 over a fixed term up to 36 months. Repayments are weekly or fortnightly to work with your cash flow.
The Prospa Plus Business Loan has an Origination Fee which is calculated at 2.5% of the loan amount.
To qualify for a loan of this size, your business needs to have been trading for at least 3 years with an annual turnover of $700,000. You must be a New Zealand Citizen (or Permanent Resident) over 18 years, own a New Zealand business (with a valid NZBN/IRD) and be able to demonstrate at least 12 months of trading.
A Prospa Plus Business Loan can be used for almost any business purpose including business renovations, to purchase inventory or new equipment, as general working capital and much more. The loan cannot be used for personal purposes.
Asset security is required to access Prospa funding over $150,000. This is in the form of a charge over assets, and Prospa may register on the PPSR or register a caveat.
A personal or director’s guarantee is a promise to repay credit that is general in nature rather than specifying security over a particular asset. The person signing the guarantee is personally liable if the business borrower is unable to re-pay the debt.
The Personal Property Securities Register (PPSR) is a central, national online register operated by the New Zealand Government. It reflects security interests registered in respect of personal property (including goods or assets). The PPSR allows priority over personal property to be assigned according to the date a security interest is registered.
A caveat is a legal document lodged to provide notice of a legal claim to a property.
When you’re applying for a Prospa Plus Business Loan of $250,000 or more, we may offer a preliminary pre-approval to help smooth out the process. We may be able to do this without a credit check and within 6 hours of your initial application. This pre-approval is based on a preliminary assessment which includes you answering some financial health check questions. It is not an offer or guarantee of finance. Unconditional approval is subject to a full credit assessment and any offer that you may receive may be on different terms.
You can apply for a business loan with Prospa if you;
- are a New Zealand Citizen (or Permanent Resident)
- are over 18 years, own a New Zealand business (with a valid NZBN/IRD)
- can demonstrate at least 6 months of trading (for the Prospa Small Business Loan $5K – $100K) or 3 years of trading (for the Prospa Plus Business Loan $100K – $500K)
The application process is quick and easy. Simplyin 10 minutes and a dedicated business lending specialist will be in touch to guide you.
To apply for up to $100,000 you’ll need identification details (valid Driver’s Licence), a valid NZBN/IRD and at least 6 months of bank statements.
Otherwise, for larger loan sizes, you’ll also need:
- $100K – $250K: Application details including credit consent, 6 – 12 months of bank statements, IRD statement (if loan above $150K).
- $250K – $500K: Application details including credit consent, 12 months of bank statements, IRD statement, last 2 years finalised financial statements, plus interim current FY financials, Aged Payables and Aged Receivables summaries.
For the Prospa Small Business Loan ($5K to $100K) we can often provide a response in one hour – as long as you apply during standard business hours and allow us to use the advanced bank verification system link to instantly verify your bank information online. If you choose to upload copies of your bank statements we can provide a decision in as little as one business day.
For the Prospa Plus Business Loan ($100K to $500K) we may be able to provide you with conditional pre-approval in around 6 hours. Once you have signed the pre-approval, turnaround times are around 2-3 days for final approval, however this may be quicker depending on the circumstances of each application. Some deals have been approved in 24 hours.
The fastest way is to make sure you apply during standard business hours and allow us to use the advanced bank verification system link to instantly verify your bank information online. If you choose to upload copies of your bank statements it will take a little longer.
Once your application is approved and we release the funds, it is possible to have money in your account the next business day.
We provide loan amounts between $5,000 and $500,000. When you make an application for a specific amount we consider a variety of factors to determine the health of your business and the level of repayments your business can support. The total amount of your loan will depend on the specific circumstances of your business.
When you make an application for a specific amount we consider a variety of factors to determine the health of your business and the level of repayments your business can support. The total amount of your loan will depend on the specific circumstances of your business.
Fees & repayments
When you apply for our business loan, we will assess the risk profile of your business and provide you with a customised offer including loan amount, term and interest rate. The Prospa business loan is an upfront priced loan so you will know in advance the total amount payable including any interest, fees or charges.
Business loan interest rates vary due to factors including the amount borrowed, what business assets the funds will be used for, the industry the business operates in, how long the business has been running, whether the business has sufficient cash ﬂow to support the loan, and the overall ‘health’ or creditworthiness of the business.
There are no hidden fees for our business loans, and you’ll know exactly how much you need to pay, and when, from day one. There’s no compounding interest and no additional fees (as long as you make your payments on time).
Prospa doesn’t charge an Application Fee. You can apply for a loan with Prospa with no upfront cost or obligation to proceed.
The Origination Fee covers the costs associated with setting up and managing the loan. You are only charged this fee if you proceed with the loan. Our Origination Fee is 2.5% of the loan amount.
You can choose to repay the entire amount of your loan early at any time.
If you decide to do this please speak to our friendly business loan specialists on 0800 005 797. They will provide you with repayment details and an early payout figure. This will be calculated as the total of the remaining principal amount and any accrued interest at the date of early payout, plus 1.5% of the remaining principal and any outstanding fees.
To help you avoid missing repayments and to fit in with your cash flow cycle we offer repayments that are either daily or weekly. These are automatically deducted from your nominated business account.
Security & privacy
Yes. We use industry recognised encryption standards to protect your personal, sensitive and financial data and we’re ISO 27001 certified for our commitment to customer security and privacy. We use an advanced bank verification system link to instantly verify your bank account information online so we can provide a fast response.
About business loans
Asset-based borrowing is when a business owner uses an asset they own to secure a loan. The asset can be either a personal asset like the family home, or a business asset like a truck or piece of equipment.
The vast majority of lenders, including the big banks, tend to secure loans against an asset. If you have trouble paying back the loan then your asset may be sold by the lender. In essence it’s a way of securing new financing by using the value of what you already have.
For loans up to $150,000 no asset security is required upfront to access the money, however we do require a personal guarantee. As long as you follow your loan obligations (as detailed in your loan contract document), asset security will never be required. For loans of over $150,000 Prospa generally takes a personal guarantee and security in the form of a charge over assets.