With 50+ lenders offering business overdrafts in Australia, choosing the right one is not straightforward. The best lender for your business depends on your revenue, credit profile, industry and how quickly you need funds.
This guide explains what to look for, what to compare and why going direct to a single lender is almost always the wrong approach.
The big four - Commonwealth Bank, Westpac, ANZ and NAB - offer business overdrafts with lower interest rates. However, they require strong financials, longer trading history, existing banking relationships and often property security. Decision times are measured in weeks, not hours. For most SMEs, the banks will say no.
Specialist non-bank lenders dominate the SME overdraft market. They move faster, require less documentation, accept businesses with managed ATO debts and do not require property security under $150,000. Rates are higher but access is far easier. Examples include Shift, Prospa, Moula, Banjo, Bizcap, Lumi, OnDeck and Judo Bank.
| Factor | What to look for |
|---|---|
| Interest rate | Annual rate on drawn funds - not the factor rate |
| Line fee | Annual fee on the approved limit regardless of use |
| Establishment fee | One-off upfront cost - typically 0.75%–4% |
| Decision speed | Hours vs days - matters when you need funds urgently |
| Documentation required | Bank statements only vs full financials |
| Property security | Required or not - and at what threshold |
| Minimum repayments | Fixed weekly repayments vs flexible |
| Redraw flexibility | Can you draw multiple times without reapplying |
| Early repayment | Can you pay off early without penalty |
When you apply directly to a lender, you trigger a credit enquiry on your file. If you apply to multiple lenders, each one records a separate enquiry. Multiple credit enquiries in a short period significantly damage your credit score - which then makes it harder to get approved and pushes your rates higher.
A broker submits to one lender only - the one most likely to approve you at the best rate. Your credit score stays protected. This alone is worth using a broker.
We compare 50+ lenders to find the best rate and structure for your business. Free broker service - we are paid by the lender, not you.
Get a free comparison →Major banks offer lower rates but are much harder to qualify for. For most SMEs, non-bank lenders offer a better overall deal when you factor in speed, eligibility and flexibility. A broker can compare both and recommend the right option for your specific situation.
Always compare the annual interest rate (not factor rate), the line fee, the establishment fee and any monthly service fees. The total cost of the facility is what matters - not just the headline interest rate.
Yes - provided the broker holds an Australian Credit Licence (ACL) or is a credit representative of an ACL holder. Check their registration on the ASIC Connect register before proceeding.
Everything you need to know about business overdrafts - eligibility, rates, lenders, how to apply and the Payday Super changes in 2026. Free to download.
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