Quick answer
A cash flow loan lends against the money passing through your business account rather than against a building or a house. The lender studies several months of deposits, the pattern of spending and what you already repay, then offers an amount that your normal takings can carry. In New Zealand, unsecured amounts commonly run from $5,000 to $500,000.
Key points
- The account's activity does the work that a property valuation would.
- Even, repeating deposits support larger amounts.
- Repayments should sit comfortably inside your quietest weeks.
- Stacked daily debits shrink what you can safely add.
- Typical size
- $5k – $500k unsecured
- Judged on
- Deposits and account conduct
- Speed
- Same day possible, smaller sums
- Security
- No property needed
A bank looks at your house and your balance sheet. A cash flow lender looks at your takings. For plenty of healthy trading businesses, especially tenants with no property to offer, that second lens is the fairer one.
What ‘cash flow lending’ really means
The loan is sized on the movement of money through your business account. If thousands of dollars arrive every week from many customers and the account rarely struggles, the lender has good reason to believe repayments will be met. They are, in effect, lending against the future repetition of a pattern they can see in black and white.
It is a different mindset from asset lending. A valuation tells a lender what could be sold if things go wrong. Statements tell a lender how likely things are to go wrong in the first place.
What the lender reads
Several signals combine into the amount on offer:
| Signal | A comfortable picture | A cautious picture |
|---|---|---|
| Deposit level | Healthy, repeating amounts | Small or shrinking amounts |
| Spread of customers | Many payers | One or two payers |
| Pattern | Regular weekly rhythm | Long gaps then big lumps |
| Balance behaviour | Positive, rarely stretched | Often overdrawn |
| Dishonours | None or explained | Several in recent months |
| Existing repayments | Modest | Several daily debits |
| Tax | GST and PAYE up to date | Growing arrears with no arrangement |
No single row decides things. Lenders weigh them together, and a clear sentence of explanation can swing a borderline view. See our bank statements guide for how to present each item.
Curious how much your takings could support? Start the 60-second enquiry.
Choosing between a loan and a line
Cash flow lending comes in two common shapes:
- A fixed loan for a defined purpose, repaid on a schedule.
- A revolving line where you draw what you need, repay as customers pay and draw again.
A loan fits a purchase. A line fits a rhythm. If you buy equipment once, take the loan. If every month there is an awkward patch before invoices clear, the business cash line is built for that.
Keeping repayments comfortable
Lending against takings only works when the repayment fits inside them with air to spare. Try this check:
- Take your lowest weekly deposit total from the past six months.
- Subtract the fixed costs that have to leave regardless: wages, rent, existing loans, insurance, tax set-asides.
- What remains is the room a new repayment must fit inside.
If the room is thin, borrow less, stretch the term or fix the leak first. Our page on the working capital loan explains how to size the amount against the gap rather than the offer.
Watch out for stacked debits
Several daily or weekly debits to different providers are a common sign of distress, and they cut sharply into the amount a new lender will consider. If that describes you, consolidating them into one facility with a predictable schedule often frees cash straight away. Details are on the cash advance alternatives page.
Things worth asking before you sign
- What is the total amount repayable, in dollars?
- Is repayment fixed or does it move with takings?
- What happens if I pay it off early?
- Are there fees on top?
- What exactly does the guarantee cover?
A word on seasonality
Cash flow lenders read patterns, so a seasonal business needs context. If takings double every December and sag in winter, supply a full twelve months so the shape is obvious, and explain the cause in a sentence. The repayment can then be arranged to ease in the quiet months and lift in the busy ones. Applying only with the last two quiet months shows a misleading picture and invites a smaller offer. Timing the application for when the account looks most representative is perfectly legitimate and often improves the outcome.
An illustrative example
Illustrative only. A physiotherapy clinic in Whangārei has banked consistent deposits from patients and ACC for two years. The owners want $60k to fit out a second treatment room but rent their premises. A cash flow loan sized on the clinic’s steady deposits is offered without any property security, with fortnightly repayments that match the ACC payment cycle.
Let the numbers speak
If your account tells a steady story, it may support more than you assume. Share the amount and purpose and we will give you a straight read. The enquiry takes about a minute, asking involves no credit check, and a real person, not an automated system, phones you back.
Give us honest figures for the amount, monthly turnover and any loans you are already repaying so the first answer is a useful one.
Frequently asked questions
How is a cash flow loan different from a bank loan?
A bank loan usually leans on security and detailed accounts. A cash flow loan leans on what the account shows, so it can be faster and lighter on paperwork, particularly for trading businesses without spare property.
What turnover do I need?
There is no single threshold. Lenders look at how much and how evenly money arrives, relative to what leaves. A modest, steady business can qualify for a modest, sensible amount.
Will a seasonal pattern count against me?
Not if it is explained. Showing a full year lets the lender see the busy and quiet months, and repayments can be shaped to suit.
Do I need to give a personal guarantee?
Often a director's guarantee is requested on unsecured lending. Ask exactly what you would be signing before you commit.