Overdraft Facility

When small businesses start to struggle make urgent payments, an overdraft facility can offer a solution to accessing the required funds.


How an overdraft facility works


An overdraft facility is a financial facility or instrument that allows people or businesses to withdraw money from their bank account, be it savings or current, even if there is no money in it. This is a form of loan or credit facility provided by the bank. In an overdraft facility, the bank charges overdraft interest rates just like any other credit facility. With an overdraft limit, you usually pay a fixed interest rate on the money you use. However, before obtaining an overdraft facility, you must first determine the benefits and drawbacks of the facility and see if it suits your financial needs.

Prospa provides other options for small businesses that are having cash flow struggles. As New Zealand’s small business lending specialists, we offer small business owners small business loans and a small business line of credit with funding possible in 24 hours. With the help of our friendly team of business lending specialists, we’ve already helped thousands of small businesses grow and take advantage of opportunities by making our loan application process faster and easier.


Prospa is leading the way for small business financing options


With small businesses at the heart of everything we do at Prospa, we have emerged as New Zealand’s go-to option for small business finance. We offer business lending to help you manage your cash flow and grow your business. In fact, thousands of clients across New Zealand that received financing through Prospa’s short-term business loans have expanded their businesses. This has manifested in our customer reviews as we are rated #1 in Trustpilot by our customers who truly valued our offers and quality of customer service.

Instead of opting for a bank overdraft, a small business loan from Prospa could be a good option to give you the cash you need. Our short-term business loan ranges from $5,000 to $100,000 and the Prospa Plus Loan offers amounts up to $500,000. Our repayments are designed for your convenience, our eligibility criteria are simple, and there are no penalties or fees for paying off your loan early. Our business loan repayment calculator is available online so you can get an idea of whether our loan might suit your business needs before choosing to apply.

Find out more about Prospa’s funding solutions here.


How Prospa is helping small businesses overcome financial challenges


A situation wherein your business bank account balance drops to below zero can be alarming. Thankfully, with products like an overdraft or line of credit facility you can take out more money than you have in the account. In other words, even if you have overdrawn, you can continue to transact and make payments. And with Prospa’s Line of Credit, you only pay interest on the funds you use.

However, if you find that you need a lump sum of funds to jump on a growth opportunity, you can apply for a loan at Prospa. With our small business loans, we can help you get the funding you need quickly and easily – with up to $150K available to approved businesses. (Up to $500K is available under our Prospa Plus Loan.)

Here’s an example: Prospa has helped a trading card and collectables business thrive during the pandemic with a small business loan. The young business owner shared with us that the lack of available stock soon became a barrier to the growth of his small business, so when he had the opportunity to secure a large stock order, he grabbed the chance to do so. With one day to pay the invoice, the business owner turned to Prospa, and with a small business loan funded within 24 hours, he was able to secure the stock.


The advantages of getting a small business loan at Prospa


Small and short-term business loans from Prospa are a convenient way to keep your company growing. Achieve your goals for your small business with the advantages that Prospa exclusively offers:

  • Loans between $5,000 and $500,000
  • Terms from 3 to 36 months
  • Weekly repayments
  • Funding possible in 24 hours
  • Early payout discount available
  • Interest rates based on your business circumstances
  • No asset security is required upfront to access Prospa funding up to $150,000

Apply now!


What a Prospa small business loan can do to maintain your operations


While an overdraft facility from your bank can give you some flexibility with your working capital, a Prospa small business loan provides a lump sum with set repayments over a fixed term so you always know where you stand.

You can use the funds for the following purposes:

  • Cash flow management
  • Business renovations
  • Marketing
  • Purchase inventory or new equipment
  • And more…


How to secure a Prospa small business loan


Applying for Prospa’s small business loan is simple. We only have three fundamental requirements:

  • You must be a New Zealand citizen (or permanent resident).
  • You must be over 18 years old and own a New Zealand business (with a valid NZBN/IRD).
  • Minimum trading history applies

Online applications are available and can take as little as 10 minutes to complete. Online approvals are typically received within an hour, and funding is possible in 24-48 hours.

Why Prospa? Because we support small business.

No more compromising or missed opportunities with Prospa by your side. This time tomorrow you could have access to funds for growth and cash flow support. It’s just what we do. We’re New Zealand’s small business lending specialist.


Fast application and decision, and funding possible in 24 hours on flexible options up to $500,000.


Talk to real people. Business Lending Specialists who are focused on getting you what you need, sooner.


Thousands of small businesses
have borrowed from Prospa.
You could benefit too.



As long as you don’t go over your overdraft limit or have payments declined, an arranged overdraft is unlikely to have an impact on your credit score. In fact, if you use your business overdraft responsibly and pay it off on time, your credit rating may even improve.

While it is never recommended to mix business and personal expenses, both an overdraft facility and a business loan function differently, so depending on your business needs, either could be a good option. For example, if you find yourself running out of cash by the end of the month or need money to cover an unexpected expense, an overdraft facility or Business Line of Credit may be the best option for you. If you need to borrow more money to cover larger expenses, a loan is a better option. Consider a small business loan from Prospa to provide a lump sum you can use to purchase equipment, grow your business or take up an opportunity.

Typically, an interest-free buffer is included with arranged overdrafts. This is the most you can owe before interest starts to accrue. On the other hand, when you don’t have an overdraft agreement with your bank but spend more than the amount in your current account, you have an unarranged overdraft.