An Australian Business Number or as it is more commonly known an ‘ABN’ number is an 11- digit registration number provided to identify businesses in Australia. Read on to discover exactly what an ABN loan is, whether you can apply for one, and what it can be used for.
What Is An ABN Loan?
If you have your own registered company in Australia you should have an ABN number. That number can be used to apply for a specific loan from individual financial institutions. These loans often come with less paperwork than others, as the lender understands that you will not be able to provide salary slips, for example. Although ABN’s are not necessarily required by law, they do give businesses certain benefits such as tax breaks. For this reason, many Australian companies do, in fact have an ABN number.
Is An ABN Loan More Expensive Than A Traditional Loan?
That depends on several criteria. The lender that you have applied to, your particular circumstances, and your credit record all play a part in how expensive your individual ABN loan may be. An ABN loan is given with an understanding that the risks to the lender are more significant. This can often influence the loan’s interest rate, which will in turn, influence how expensive the loan is.
What Is The Application Process For ABN Loans?
- Look for specialised lenders. Not every lender offers an ABN loan. Take the time to thoroughly search for a lender that suits your individual needs.
- Have your ABN handy. Your 11-digit ABN will be required by your lender as part of the criteria in approving your loan. Make sure that you know exactly what it is and you have a record of obtaining it. You can apply for an ABN online, and it doesn’t cost anything!
- Hang on for a year. This may sound a bit unreasonable, but if you are self employed your lender will want to see whether your business has been productive for at least a year. This reduces your risks and also allows you time to ensure you can repay your loan.
- Hang on to your tax records. Having your tax records on hand is another great way to help lenders feel more confident about granting you an ABN loan. They will undoubtedly ask you for your tax returns from the last year to ensure that your company is above board.
- Get your bank statements ready. Almost every lender will ask you for at least three months of bank statements. This is also to ensure that your company is, in fact, making money, and you will be able to pay the loan back. Be sure to have these on hand.
What Can ABN Loans Be Used For
ABN loans should be used for your business or business-related issues. Company cars and premises are included in this.
Now that you’re more familiar with what an ABN loan is and can do for you, contact iCredit and we’ll assist you.