Sole Trader Business Loan in Australia (2025): Your Options, Eligibility & Fast Approval Tips
Last updated: 5 August 2025
By Michael Pajar, Director & Business Finance Broker, Casey Asset Finance
Bank said no? Short on paperwork? Here’s a clear, credit-safe way for sole traders to get funded—without wasting time.
What is a sole trader business loan?
A sole trader business loan is funding for ABN holders operating as individuals to cover cash flow, stock, tools/vehicles or growth. Lenders assess recent bank activity, turnover and trading stability; documents range from low-doc (bank statements) to full-doc (financials). Common options include unsecured term loans, overdrafts/lines of credit, and equipment finance. Timeframes vary—most files can settle within 24–48 hours.
Quick facts
Eligible if you’re trading and depositing income to a business account
Docs: usually 3–6 months bank statements; full-doc may add BAS/financials
Options: unsecured term loans, overdraft/LOC, equipment finance
Speed: as fast as 24–48 hours (scenario-dependent)
Contents
What is a sole trader business loan?
Who it suits (common use cases)
Low-doc vs full-doc (sole trader edition)
Overdraft/LOC vs term loan
Equipment finance for sole traders
Fast-track your approval (broker tips)
Common blockers & how to fix them
Costs explained simply
Protecting your credit file
How we work (4 clear steps)
FAQs
Eligibility & Documents
Low-Doc Unsecured
ABN age: often 6+ months preferred
GST registration: often required
Minimum monthly turnover: commonly from $10k+ (varies)
Bank-statement months: typically 6+ months
Typical amounts & terms: short-to-mid terms; monthly turnover determines max loan amount
Security: usually unsecured; personal guarantee
Settlement speed: as fast as 24–48 hours for clean files
Common deal-killers: thin daily balances, recent returned debits (dishonours), multiple loan enquiries
Full-Doc Unsecured
ABN age: often 12+ months
GST registration: yes
Minimum monthly turnover: $10k+
Bank-statement months: 6+ months; financials or YTD management accounts
Typical amounts & terms: larger amounts; potentially longer terms for stronger deals
Security: usually unsecured (product); personal guarantee
Settlement speed: several days+ (lender needs to manually assess)
Common deal-killers: Inconsistent income credits, tax arrears without a plan
Overdraft / Line of Credit (LOC)
ABN age: 12-24+ months
GST registration: yes
Minimum monthly turnover: 20k+
Bank-statement months: usually 12+
Typical limits & terms: revolving limit; interest on drawn amount; limit often monthly turnover
Security: often unsecured; terms vary; personal guarantee
Settlement speed: days to set up; then flexible drawdowns
Common deal-killers: low average daily balance, frequent overdrawn days
Equipment Finance
ABN age: 1-day ABN acceptable
GST registration: often required
Minimum monthly turnover: based on your repayment capacity
Bank-statement months: usually 6; additional docs invoice/valuation
Typical amounts & terms: asset-matched terms; residuals possible
Security: PPSR charge over the equipment/vehicle funded
Settlement speed: typically 48 business hours; longer for complex assets
Common deal-killers: asset age too old, poor asset condition, insufficient serviceability, missing work source letter for 1-day ABNs
Criteria vary by lender and scenario.
Commonly used for
Buying stock ahead of busy periods
Replacing/adding tools or a vehicle
Smoothing lumpy cash flow between invoices
Funding a marketing push or launching a new contract
Bridging timing gaps while you scale
Low-doc vs full-doc (sole trader edition)
Low-doc are faster with lighter paperwork (usually 3–6 months of statements). Ideal when you’re time-poor or still finalising BAS/financials, and your recent deposits are consistent with no red flags in your account.
Full-doc loans can unlock larger amounts but needs more documentation and time for the assessment. Choose based on urgency, how much you need, and how clean your statements look (and if they need to be supported by more documentation).
Overdraft/LOC vs term loan
Overdraft/LOC gives flexible access—draw, repay, draw again—useful for smoothing peaks and troughs.
A term loan gives certainty: a set amount with fixed repayments. Best when buying stock, funding a project, or consolidating short-term needs into a clear plan.
Quick tip: some lenders allow you to repay the loan from 3 months+ with no early exit fees.
Equipment finance for sole traders
If you’re buying a vehicle, machinery, or equipment, asset-based finance can be smarter than unsecured: terms align to the asset’s life, and pricing can reflect security. Expect PPSR over the asset and, where appropriate, residuals at term end. Loan amounts are also much greater than unsecured loans.
Fast-track your approval (broker-level tips)
Keep a stable average daily balance in your business account
Avoid multiple same-day applications—they harm your credit file and muddy underwriting
Explain variances (seasonality, one-offs) with short notes
Sequence BAS/ATO matters—lodged and up to date helps
Time larger deposits/invoices before submission where genuine
Use one coordinated broker submission so you don’t burn options
Want a quick, no-impact pre-assessment? Share a few details and I’ll map your best path in plain English. Start your 60-second check (no credit hit).
Common blockers & how to fix them
New ABN (<6 months): start smaller or use asset-based options first
Not GST-registered: still possible; check with the lender
Thin statements/returned debits: stabilise cash flow; show consistent deposits, maintain healthy account balance
ATO arrears: set up a plan and provide your payment plan schedule
Seasonal revenue: provide context; show bookings or forward contracts to support gaps
Costs explained simply
Look beyond the headline rate. Compare total cost, fees, and the impact on weekly cash flow. If you see factor rates, remember they’re designed for very short terms (≤6 months). Avoid stacking multiple short-term loans—consolidate or restructure where appropriate.
Quick tip: if you’re a sole trader, and you’re considering a cap loan (and you own property), please speak to your trusted accountant before signing the dotted line.
Protecting your credit file
Every hard enquiry counts. A single, well-packaged, broker-coordinated submission protects your file and lets you negotiate from strength. Please take note there are transactional brokers, and there are trusted advisors that are brokers. Start with a credit-safe pre-assessment so you know where you stand—without the hit.
How we work (4 clear steps)
Quick enquiry — share basics via our short online form
Credit-safe pre-assessment — we review statements and scenario (no hard enquiry)
Options & trade-offs — we explain the details, what we need, and the available lenders
One quality submission — we package and submit where approval odds are best
FAQs
Can a sole trader get a business loan without financials?
Yes—low-doc options are the most common types of applications for sole traders—requiring only bank statements. Larger amounts may require full-doc (BAS/financials/portals).
Do I need to be GST-registered?
Not always. Lenders look at turnover, trading stability, and repayment capacity.
How long must my ABN be active?
Many lenders prefer at least 6–12+ months. New ABNs may still qualify for asset-based options.
How fast can funds settle?
Straightforward low-doc files can settle within 24–48 hours—sometimes even same day. Complex cases take longer.
Can I get approved with bad credit as a sole trader?
Possibly—context matters. We assess bank activity, stability, and a clear plan for the funds. If you have a poor Equifax credit score, you’ll need to know why (we will tell you how to improve your score over time).
Line of credit vs term loan—what’s better for lumpy cash flow?
LOCs for smooth peaks and troughs; term loans suit one-off needs or planned purchases.
Is equipment finance easier than unsecured for sole traders?
Almost always—the lender has an asset secured to the loan. This means if the borrower defaults, the lender can use the asset to payout the loan.
Will applying hurt my credit score?
We start with a credit-safe pre-assessment (no hard enquiry). Then we coordinate one quality submission. Unfortunately, many clients we’ve spoken to have worked with brokers that have enquired one too many times (this is often due to the broker not workshopping the file with the lender first, and instead submitting the loan application).
Disclaimer: This is general information only. Please speak to your accountant or finance broker for tailored financial advice for your specific situation. Criteria varies by lender and scenario. No guarantees are made and every application is always subject to credit assessment.
Are you a sole trader? Got a question about your ABN, turnover, or docs?
Ask me now—happy to point you in the right direction.
Check your eligibility—press the button below (no credit hit).
Or feel free to call or text me at 0450 622 115.
Email: michael@caseyassetfinance.com.au
