Can Your Business Get a Private Line of Credit?

Why banks rarely offer business lines of credit anymore

Major banks have withdrawn from small business lending. They demand strict serviceability tests, require 2+ years of audited financials, and often reject businesses with any ATO debt or credit blips. Even profitable businesses get declined because they don't fit the bank's rigid criteria. This leaves business owners trapped — needing working capital to grow, but unable to access it through traditional channels.

How private lenders structure business lines of credit

Specialist lenders offer flexible lines of credit by assessing your actual business cash flow and willingness to back the loan with security.

Business revenue — They verify real monthly turnover from bank statements and GST records, not just tax returns.
Security position — Lines of credit are usually secured against business assets, property, or personal guarantees.
Flexibility — You draw down only what you need, when you need it, and pay interest only on what's drawn.

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What a typical line of credit looks like

Illustrative example — not a real case

A tile and bathroom supplier with $320K monthly revenue was offered a $100K line of credit from a private lender. The facility was secured by a second mortgage on the owner's residential property (equity position $250K+). The owner drew $60K immediately to purchase stock for a new shopping centre contract. They paid 0.8% per month (9.6% p.a.) on the drawn amount only — roughly $480/month. Once the shopping centre paid invoices 30 days later, the owner repaid $40K, reducing monthly interest to $160. The line remained open for 12 months, used flexibly as project-based cash needs arose.

Typical line of credit structure

Facility size

$5K–$5M

Interest only period

Draw-down phase

Typical term

3–12 months

Settlement speed

7–14 days

Suitable for

Working capital, stock, payroll, tax payments

Ranges shown are across our full panel of specialist lenders. Your deal may fall within a narrower range depending on the specifics.

What lenders want to see

3–6 months of business bank statements showing deposits and cash flow patterns.
Latest GST statement (last 3 months) or BAS confirming monthly turnover.
Details of any ATO debt: if present, a payment arrangement must be in place.
Personal tax returns (2 years) and details of personal assets or security offered.

When this might not work

A business line of credit may not work if: (1) your business is less than 6 months old, (2) monthly revenue is highly volatile or declining, (3) you have no assets or equity to offer as security, or (4) you need the funds for speculative investment rather than operational cash flow.

What our panel can offer for this scenario

Fast assessment based on business revenue, not credit score
Flexible terms tailored to your cash flow pattern
Access to capital even with ATO debt or prior defaults
Decision within 24–48 hours for most applications

The exact lender and terms depend on your specific deal. Describe your situation and our AI will match you with the most suitable lenders.

How to get started — step by step

Step 1: Describe your situation. Tell us about your business, what you need the funds for, and any credit or ATO challenges you're facing.
Step 2: Get matched with lenders. Our AI analyses your details and matches you with specialist lenders most likely to say yes.
Step 3: Review and move forward. Compare options, ask questions, and choose the lender that fits your situation best.

Common questions

Is a line of credit the same as a business loan?

No. A line of credit is a revolving facility — you draw what you need and repay flexibly. A term loan is a lump sum with fixed repayments. Lines of credit suit businesses with variable cash flow needs.

What if I have ATO debt?

Many lenders will work with ATO debt if you have a payment arrangement in place. They assess whether the arrangement is genuine and sustainable based on your business cash flow.

How much can I borrow?

Lenders typically offer 50–70% of your monthly business revenue as a credit limit. A business turning $200K monthly might qualify for a $100K–$140K facility.

Do I pay interest on the full amount?

No. You only pay interest on what you've actually drawn. If the limit is $100K but you've only drawn $30K, interest is calculated on $30K only.

Can I use this for personal expenses?

Generally no — lenders want the credit used for genuine business purposes (stock, equipment, payroll, working capital). Using it for personal needs will breach the loan agreement.