FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The Korokoro Small Business Loans
Tell me how you are able to avail the Korokoro Small Business Loans
Korokoro unsecured loans provides amounts between $5,000 and $100,000, with terms ranging from 3 and 24 month and cash flow-friendly repayments that are either per day or weekly.
What is the Unsecured Loan different from an traditional business loan?
Apply to your Small Business Loan in under 10 minutes online or over the phone, receive an immediate response, and the funds could be available in just 24 hours. Traditional business loans have an annual interest rate along with other charges and fees. The company loan is an upfront priced loan which means you know ahead of time the total amount due, which includes the interest, fees and charges. This is then broken down into either weekly or daily amount to be paid back.
What could you use the Small Business Loan be used for?
A Small Business Loan can be used for almost every business reason, such as control of cash flow business remodeling, marketing to purchase inventory or new equipment, as general working capital, and much more. The loan cannot be used to fund personal expenses.
About larger Korokoro Business Loans
What is the Larger Korokoro Business Loan?
The Larger Business Loan is a larger size loan to aid in company expansion opportunities. The loan ranges from $100,000 to $500,000 for a fixed period of for up to 36 months. The repayments are made weekly or fortnightly depending on your situation.
How is the Origination Fee determined?
It is crucial to note that the Larger Business Loan has an Origination Fee which is calculated at 2.5 percent of the amount of the loan.
Am I eligible for the Larger Business Loan?
In order to be eligible for a loan in this amount the company needs to have been trading for at least 3 years, and have an annual income of $700,000. You must be a New Zealand Citizen (or Permanent Resident) over 18 years as well as own a New Zealand company (with a valid NZBN/IRD) and be able to prove at minimum 12 months of business.
How can the funding be used for?
A large company loan can be used to fund almost any company use, including company renovations, purchase of new equipment or inventory for general working capital and much more. The loan is not available for personal purposes.
Is the Larger Business Loan a secured loan?
Asset security is required to obtain funding above $150,000. It is usually as a result of an charge against assets, and could include the registration of this with the PPSR or registering as a caveat.
A director’s or personal ensure is a promise to pay off a credit line that is generally based rather than specifying security over an asset. The person who signs the ensure is personally responsible if the business borrower is unable to make the repayment.
The Personal Property Securities Register (PPSR) is an online central register operated by the New Zealand Government. It records security interests that have been that are registered for personal property (including items or assets). The PPSR allows priority over personal property to be assigned depending on the date that a security interest has been registered.
Caveats are legal document lodged to offer an official notice of a claim on a property.
What is a pre-approval that does not require Credit Check?
If you’re requesting a Larger Business Loan of more than $250K it’s possible to offer an initial pre-approval in order to make the process. We may be able to make this decision without a credit check and within six hours of your initial application. The pre-approval is based upon an initial assessment that includes the answer to a series of financial well-being questions. It is neither an offer nor a guarantee of credit. The approval of a conditional loan is subject to an exhaustive credit evaluation, and any offer you may receive may have different terms.
The application process
Are I eligible for funding?
You can apply for a company loan if you;
- are a New Zealand Citizen (or Permanent Resident)
- are at least 18 years old, own a New Zealand business (with a valid NZBN/IRD)
- must show at least six months of trading (for for the unsecured loan $5K – $100K) or 3 years of trading (for the Larger Business Loan $100K up to $500K)
How do I apply?
The application process is quick and easy. Complete the online form in just a few minutes, and a dedicated company lending specialist will be in touch to guide you through the process.
To be eligible for up to $100,000 you’ll require identification details (valid Driver’s Licence) and an NZBN/IRD that is valid and at least six months worth of bank statements.
If you’re looking for loans with larger sizes, you’ll require:
$100K-$250K: Details of application, including credit consent, 6-12 months of bank statements, IRD statement (if the loan is greater than $150K).
$250K to $500K: Details of the application, including credit consent as well as 12 months of bank records, IRD statement Last 2 years’ finalised financial statements, in addition to interim financials from the current financial year such as age-related payables and aged Receivables summary.
What speed will I be able to get a decision?
For an unsecured loan ($5K up to $100,000) we can often offer an answer within an hour, provided you make your application at quality company timings and allow us to use the advanced bank verification system link to immediately verify your bank account information online. If you opt to upload copies of your bank statement, we’ll provide an answer in just one company day.
For the Larger Business Loan ($100K to $500K) we might be in a position to offer you with conditional pre-approval within about six hours. After you’ve signed the pre-approval document, you will require to wait around 2-3 days for final approval. However, this can be quicker based on the circumstances of each application. Certain transactions have received approval within the space of 24 hours.
The fastest way would be to ensure you apply during standard business hours and allow us to use the advance bank verification link to check your bank’s information online. If you choose to send us the copies of bank statements , it can take a bit longer.
How soon will I receive the cash?
For the Small Business Loan ($5K up to $100,000) we can often provide an answer within one hour – as long as you make your application at standard business time and you allow us to make use of the advanced bank verification system to instantly verify your bank information online. If you choose to upload copies of your banking statements, we are able to offer an answer in just one business day.
If you are applying for Larger Business Loans ($100K or more) we may be capable of offer you with pre-approval conditional to your application in about 6 hours. Once you’ve signed the pre-approval, turnaround times are approximately 2-3 days to receive final approval, however this may be quicker depending upon the circumstances for each application. Some deals have been approved in less than 24 hours.
The most effective method is to ensure you apply during standard business hours. Also, allow us to use our modern bank verification to check your bank’s information online. If you upload duplicates of your banking accounts, it can take a bit longer.
How much can I borrow?
We provide loans ranging from $5,000 and $500,000. If you apply for a particular amount, we take into consideration a range of aspects in order to assess what is the well-being of your company and the amount of payments your company can afford. The total amount of your loan will be contingent on the specifics that are unique to your business.
If you apply for a set amount, we will consider a number of variables to determine the well-being of your business as well as the amount of repayments your company is able to afford. The total amount of your loan will be determined by the specifics for your business.
Fees & repayments
How much do you charge for the cost of a business loan?
When you request our business loans, we will assess the risk profile the company and provide you with a customised proposal that includes the amount of loan, the term and interest rates. It is a business loan is an upfront cost loan and you’ll be aware in advance of the total amount to be paid, including any costs, fees, or interest rates.
What determines the amount I’m charged?
Business loan interest rates depend on a variety of factors including the amount that is borrowed, what business assets the money will be used for as well as the field the company is in, how long the business is in operation, what percentage of the company has sufficient cash flow to pay for the loan, as well as the overall well-being or creditworthiness of the company.
What are the charges?
There aren’t any hidden charges for our company loans. You’ll know precisely how much you need to pay, and when, right from the very first day. There’s no compounding interest, and there are no additional charges (as as long as you pay your payments in time).
We don’t charge an Application Fee. You are able to apply for a loan absolutely no upfront cost and no obligation to proceed.
The Origination Fee covers the costs associated with establishing and managing the loan. This is only a fee if you decide to take the loan. Our Origination Fee is 2.5 percent of the loan amount.
Can I pay off the loan earlier?
You may choose to pay back the entire amount of your loan at any point in time.
If you do decide to take this route, please call our helpful company loans specialists. They’ll offer you with details on repayment and an early payment figure. It will be calculated using the sum of the principal amount remaining plus any accrued interest as of the time of the early payout and 1.5% of the principal balance and any outstanding fees.
How do repayments work?
To ensure you do not miss repayments and to fit in your cash flow cycle we offer repayments either daily or weekly. These are automatically deducted from your business account.
Security & privacy
Will my information be secure?
Making sure that your information is secure, and being clear about the ways we gather information, use it, and exchange it, as well as protect your information, is vital and a vital aspect of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We make use of industry-standard encryption standards to protect your sensitive, personal as well as financial data. Our funders are ISO 27001 qualified for our dedication to customer security and privacy. We use an advanced banking verification system to instantly verify your bank account details online. This allows us to offer a fast response.
About business loans
What is asset-based borrowing (a secured loan)?
An asset-based loan is when an business owner borrows from an asset they own to get a loan. The asset may be an individual asset, such as the family home, or a company asset such as a vehicle as well as a piece of machine.
The majority of banks, even the largest banks, are inclined to guarantee loans against assets. If you’re having trouble paying back the loan, the asset could be offered for sale by the lender. In essence it’s the process of securing new funding using the worth of the asset you already own.
Should I need security for a business loan?
For loans up to $150,000 no asset security is required upfront to access the money however, we require a personal guarantee. require the personal guarantee. As long as you follow your loan obligations (as stipulated in your loan contract), asset security is not required. For loans that exceed $150,000, generally, there is a personal guarantee and security in the form charges on assets.