Working capital · business overdraft
Working capital that's there when you need it, idle when you don't.
A facility attached to your business operating account. Pay interest only on the portion you use. The traditional bank product, still the cleanest fit for cyclical or unpredictable cashflow.
What it is, when it fits
Plain English, with the trade-offs.
A business overdraft is a credit limit attached to your everyday operating account. You only pay interest on what you actually draw, and only for the days you draw it; when you're in surplus, the facility costs nothing beyond a small ongoing fee. That's why overdrafts are still the cleanest tool for unpredictable or cyclical cashflow: you don't pay for capacity you don't use, and the facility is always there. The trade-off is that overdrafts are bank-led products with full underwriting (financials, security, sometimes director's guarantee). Setup typically takes 2 to 6 weeks, longer than most fintech alternatives. Annual review is the norm, and the bank can reduce or withdraw the limit if your trading deteriorates. Pricing is competitive (7% to 15% p.a. on drawn balance for established businesses) and security is usually a charge over business assets and/or property.
Hands reviewing finance documents over a paper-strewn table.
Typical scenarios
Seasonal business smoothing the winter dip
Why: Steady summer revenue, slow winter; payroll constant.
Outcome: $200K overdraft drawn April-September, sits idle October-March. Costs nothing when in surplus.
Professional services bridging quarterly invoicing
Why: Big quarterly invoices, monthly payroll.
Outcome: $120K overdraft used for 6 weeks of each quarter, repaid on quarterly receipts.
Retail buying for sales periods
Why: Pre-Christmas stock buy, payment to suppliers 60 days before customer revenue.
Outcome: $300K overdraft drawn September-November, repaid through December peak.
Construction subbie bridging progress payments
Why: Materials and crew costs paid weekly, head contractor pays monthly.
Outcome: $150K overdraft used for week-to-month gap on each contract.
Lenders for this product
Who we work with.
- NAB Business
- CommBank Business
- Westpac Business
- ANZ Business
- Bank of Queensland
- Suncorp Business
Lender accreditation varies; not every lender is available for every deal. We pick from the panel based on your specific situation.
How it works
From brief to settlement.
- 01
Banking relationship review
We review your current banking and trading data to understand how the overdraft would actually be used. Bank appetite varies sharply on tenure, account behaviour, and security position.
- 02
Targeted bank introduction
Most overdrafts work better with a specialist business banker than the generic application desk. We make the introduction directly to the right team.
- 03
Documentation and approval
Bank-led facilities require a fuller document pack than fintech alternatives (financials, BAS, statements, director ID, security details). Typical 3 to 6 weeks from formal application to approval.
- 04
Settlement and ongoing review
Facility goes live on the operating account. We check in at annual review and any time trading materially shifts so the facility stays right-sized.
Indicative pricing & terms
Ranges, not promises.
Rate range
7 to 15% p.a. on drawn balance
Loan size
$10K to $500K typical
Term
Ongoing facility, annual review
Security
Charge over business assets, sometimes property
Indicative only; specific pricing depends on lender, security, and your business profile.
Frequently asked
Honest answers, plain English.
Overdraft vs line of credit, what's the difference?
A business overdraft attaches to your operating account; a line of credit is a separate facility you draw from. Overdrafts are bank-led products with longer setup but lower ongoing rates. Lines of credit are usually faster to set up via non-bank lenders, with somewhat higher pricing in exchange for that speed and policy flexibility.
How does annual review actually work?
Each year (sometimes less often for established relationships) the bank reviews trading data and updated financials and confirms or adjusts the limit. If trading is steady, it's a formality; if trading has weakened materially, the bank can reduce or withdraw the limit. Plan refinances around review dates if cashflow has been bumpy.
What security do banks usually want?
For overdrafts under $250K, often a director's guarantee plus a charge over business assets is enough. Above that, banks frequently want a property charge (residential or commercial). Specialist non-bank lenders sometimes offer unsecured lines of credit at higher rates if you want to keep the home unencumbered.
What happens if I exceed the limit?
Most banks bounce transactions that would breach the limit, or honour them with a substantial unauthorised-overdraft fee (often $30 to $50 per occurrence). Tell the relationship manager early if a temporary breach is likely; banks usually allow a short-term limit increase rather than penalty-fee a planned excess.
How long does setup take?
Typically 2 to 6 weeks for a new bank relationship; faster for an existing customer with strong banking history. The slowest part is usually documentation collection and the bank's independent property valuation if a property charge is involved.
Can I switch banks without losing the overdraft?
Yes, but plan for an overlap period. Apply with the new bank, get formal approval, then time the switch so the new facility is live before you wind down the old one. Banks are generally cooperative with discharges; the gotchas are usually around early-discharge fees and timing of property charge releases.
Related products
If this isn't quite the fit.
Next step
Twenty minutes, no obligation.
Tell us the shape of the deal and the timing. We'll send a lender shortlist for business overdraft or, if it isn't the right fit, an honest signal of what is.