Prospa Line of Credit
Prospa Line of Credit
If you can’t find the answer to your query below, please email us at [email protected] and one of our friendly customer service team members will contact you.
About Prospa Business Line of Credit
A Prospa Business Line of Credit is a facility that gives you flexible, ongoing access to funds to help you confidently manage cash flow fluctuations in your business. You can use and reuse the funds, up to your approved credit limit, as much or as little as you like during your renewable 24-month term. You only pay interest on the funds you use, while you’re using them.
A Prospa Business Line of Credit is designed to give you confidence to help you manage any unexpected cash flow gaps. A line of credit is often used to pay staff wages, cover unpaid invoices, buy urgent stock, manage seasonal cash flow fluctuations, pay suppliers, and manage BAS payments and late-paying customers.
It’s important to do your homework, explore your options and decide on the most appropriate funding solution for your business’ needs.
Applying for a Prospa Business Line of Credit
If your business’ monthly turnover is more than $6,000 and you’ve been trading for at least 6 months, you can apply.
It’s easy – and only takes 10 minutes! Fill out this short online form and a Prospa small business lending specialist will be in touch.
You’ll just need an active ABN, your business bank account details and your driver’s licence details.
We can often provide a response in one hour – as long as you apply during standard business hours and allow us to use the advanced bank verification system link to instantly verify your bank information online. If you choose to upload copies of your bank statements we can provide a decision in as little as one business day.
If you apply before 4pm on a business day and your application is approved, it is possible to have money in your account the next business day.
We offer line of credit facilities of between $2,000 and $150,000. When you apply, we assess the financial health of your business and the repayments it can support. The size of your line of credit and the interest rate will depend on the specific circumstances of your business.
No asset security is required upfront to access up to $150K in Prospa funding, although we do require a personal guarantee. As long as you continue to meet your obligations under the line of credit, such as payment obligations (detailed in your contract), asset security will never be required.
Where your combined exposure to our products exceeds $150K, Prospa takes security in the form of a charge over your assets.
Using a Business Line of Credit
There are two ways to access and view the funds within your Prospa Business Line of Credit:
- The Prospa online portal, or
- The Prospa mobile app.
Once logged in, you can view transactions, transfer funds to your nominated business bank account, pay invoices, staff and suppliers directly, make purchases, set up scheduled and recurring payments and much more.
When you draw down funds for the first time they can take up to 3 business days to clear into your account, however each time you draw down funds after that they should be in your account within 1 day. Any draw downs processed after 4pm AEST will not be processed until the next business day.
We will direct debit your nominated bank account weekly with a minimum repayment comprising of principal and interest on amounts drawn under the facility, as well as a weekly service fee and any other applicable fees (see fee section below). But you can also make additional repayments at any time.
You only pay interest on the funds you have drawn down, and only until you repay those funds.
Interest is charged at a fixed annual percentage rate. It is calculated daily based on your drawn balance (i.e. the amount of your line of credit facility that has been drawn down and not repaid), and charged weekly.
You can make repayments above and beyond the weekly minimum. Any additional repayments will reduce the amount of interest you are charged, as we only charge interest on the funds you use, while you use them
If you need to increase the limit of your line of credit, speak to your dedicated small business lending specialist on 1300 882 867 to see what options may be available.
A weekly service fee is charged from the date of settlement, payable in arrears each week. The fee is 0.046% of the facility limit per week.
If we attempt to direct debit your business account for the regular weekly repayment and the payment can’t be made, there will be a $25 dishonour fee, as well as a late payment fee.
If approved, your line of credit is for a 24-month term.
If you would prefer to use the “Pay anyone” function on your Line of Credit to transfer to any other account you can, however this function has a $10,000 limit per day and you should allow 3-5 business days for these funds to clear into the chosen account.
End of Term Process
On or before the end of the 24-month term you can choose from the following options:
- you can apply to renew your Line of Credit for a further 24-month term; or
- you can arrange to close your Line of Credit.
If you elect to renew your Line of Credit for a further 24-month term, we will need to complete a new assessment to check whether there have been any changes in your business. If the term is renewed, it may be on terms and conditions that are the same or different to your original terms and conditions (for example, the interest rate and/or facility limit may change). You can also review your facility limit based on your business’s current needs.
If you elect to close your Line of Credit at the end of the term, there are two possible options available to you to repay the outstanding balance.
You can elect to repay the entire outstanding balance at the end of the term.
If you are eligible, you may elect to repay your outstanding balance on a 52-week repayment plan. This repayment plan will commence immediately after your Line of Credit term finishes. At this time, your access to the facility will be suspended and the outstanding balance of your Line of Credit will be divided into 52 instalments. These instalments will be direct debited from your bank account each week along with that week’s accrued interest and Weekly Service Fee until your outstanding balance is paid down to $0. Interest will accrue on the outstanding balance throughout the 52 weeks at the same rate as your Line of Credit. To be eligible for the 52-week repayment plan you must not be in arrears at the end of your Line of Credit term.
If you do not select an option on or before the date on which the term ends or you apply for and are not approved for a term extension, your Line of Credit will be closed and, if eligible, you will be placed on the 52-week repayment plan.
You can pay off the balance of your line of credit at any time.
Security and Privacy
Yes. We use industry recognised encryption standards to protect your personal, sensitive and financial data and are ISO27001 certified, validating our commitment to customer data security and privacy. We use an advanced bank verification system link to instantly verify your bank account information online so we can provide a fast response.