Bad credit is one of the most common concerns we hear from SME owners seeking business finance. The good news is that bad credit does not automatically disqualify you - especially when working with non-bank lenders through a specialist broker.
Here is the honest picture of what bad credit means for your business overdraft application in Australia.
Lenders use Equifax (formerly Veda) credit scores to assess credit history. Scores generally range from 0 to 1,200. Here is how lenders typically categorise them:
| Score range | Rating | Impact on overdraft |
|---|---|---|
| 800–1,200 | Excellent | Best rates, highest limits |
| 700–799 | Very good | Strong approval chance, good rates |
| 625–699 | Good | Most lenders will approve |
| 550–624 | Average | Non-bank lenders will consider |
| Under 550 | Below average | Specialist lenders only, higher rates |
Key insight: Most non-bank lenders set their minimum at 550. Some specialist lenders will go lower. Your credit score is one factor - not the only one.
Non-bank lenders take a holistic view. A low credit score can be offset by:
Important: Even with these issues, specialist lenders exist. The key is working with a broker who knows which lenders have appetite for your specific situation - rather than applying blind and collecting rejections that further damage your score.
Related: Download the Business Overdraft Factsheet and Unsecured Business Overdraft Factsheet for rates, eligibility and worked examples.
OverdraftMe works with lenders across the credit spectrum. We will give you an honest assessment of your options before submitting any application - protecting your credit score in the process.
Get a free assessment →For more on what lenders look at, read our guide on credit scores and business loans in Australia. Or use our borrowing calculator to estimate how much your business could access.
Yes - many non-bank lenders will consider applications with imperfect credit history, particularly if the business has strong revenue and the credit issues are historical rather than current.
Most non-bank lenders look for an Equifax score of 550+. Some specialist lenders will consider scores below this, particularly for businesses with strong revenue.
A managed ATO payment plan is generally acceptable to most non-bank lenders. In fact, approximately 60% of approvals through specialist brokers involve businesses with a managed ATO debt.
A formal application will trigger a credit enquiry. Using a broker means only one enquiry rather than multiple - protecting your score. Initial assessments through OverdraftMe do not affect your credit score.
Everything you need to know - eligibility, rates, lenders, how to apply and Payday Super 2026. Free download.
Download the free guide →