What is Cashflow Finance?
Quite simply, cashflow finance is short-term finance that is used to help you cover the business’s day-to-day expenses by smoothing out your business’s cashflow.
When you’re running a business, cashflow is often one of the most difficult things to manage.
Because while your P&L may look pretty rosy come the end of the financial year, the day-to-day reality is often somewhat different.
The peaks and troughs of money coming into the business are very, very real – and they can cause significant issues for the day-to-day.
Unfortunately, seasonal business fluctuations or late-paying clients don’t seem to care too much about your financial obligations.
In fact, research frequently shows that cashflow – rather than unprofitability – is a major reason why New Zealand’s businesses go out of business.
While businesses can implement steps to improve their cashflow management – for example, stipulating full or partial payment up front, issuing tighter invoice terms or moving people to debt collection more quickly – and introducing measures to smooth those seasonal ups and downs, that will only go so far.
After all, there are still bills to pay, staff to employ and inventory to buy.
That’s where cashflow lending comes in.
Trusted by Australian Small Businesses
5 Ways that Poor Cash Flow Can
Damage your Business
Inability to pay suppliers – Unable to pay your suppliers reflects poorly on your business and impacts the ability to your deadlines and other obligations.
Late or unpaid debt repayments – This can adversely affect your credit score and impact your ability to get credit in the future. In a much more severe scenario, this can also result in legal action or even insolvency.
Inability to buy new inventory – This has a direct impact on the day-to-day operations of your business and if you are unable to pay for inventory then your business could be in serious trouble along with the lost opportunity cost of being able to cease inventory opportunities that may arise.
Unpaid staff wages – This can have a serious impact on your employees and can risk the reputation of your business.Making sure your staff have confidence in receiving their paycheck is key to recruiting and retaining good talent.
Loss of contracts – This is a direct result of you being unable to pay your suppliers, your staff or even your debts-you can end up losing your contracts and even your contacts.
What can Cashflow Finance be used for?
Cash flow finance can be used for a multitude of situations, whether it’s paying staff salaries, settling bills, taking advantage of a new business opportunity, or buying new equipment, cashflow finance can help with your day to day operating expenses.
Cashflow is an important factor to determine whether your business has the ability to remain solvent as well as its ability to meet any future requirements for capital and growth.
What are the 3 types of cash flows?
Operating activities which is mainly the cash flow from day to day running of business
Investments which is the cash flow from future ventures
Financing which is cash flow from bank loans, equity, and dividends
Fast and flexible loans to grow your business
Move fast, confidently
Fill out an application form and get a decision within an hour & funds within 3 hours
High Approval Rates
We’re New Zealand’s most open-minded lender and can often help even if you’ve been declined by others before
Cash Flow Friendly Repayments
Once you have your loan with Bizcap, we organise daily or weekly repayments based on your businesses peaks and troughs
Real Customers solving their business problems with Bizcap
|Revenue Increase In The Last 8 Months||380%|
|Loan Use||General Cashflow|
|Turn Around Time||2 Hours|
|Loan Use||Inventory Purchase|
|Turn Around Time||5 Hours|
FAQs about our
Cash Flow Finance
What is cash flow finance?
Quite simply, cash flow finance is short term finance that is used to help you cover the business’s day-to-day expenses by smoothing out your business’s cash flow.
What is a cash flow example?
Cash is the difference between the cash received by a business from sales of its goods or services and the cash spent on its operations, financing, and investments. It is normally calculated over a specific period of time and varies from business to business.
What can cash flow finance be used for?
Cash flow finance is designed to be used to cover your regular business transactions – for example, paying staff salaries, paying bills, taking advantage of a new business opportunity or buying new equipment.
Why is cash flow so important?
What is considered a good cash flow?
Can cash flow loans be used to help seasonal businesses?
How do you explain cash flow?
How is cash flow calculated?
How quickly can I get a cash flow loan?
How long can I take out a cash flow loan for?
How can I apply for a business loan to help smooth my cash flow?
Additional Questions for an unsecured Business loan
What are the fees and repayments?
The fees and repayments are tailored to your individual circumstances. They will be determined by your cash flow, payment history and general financial strength, as well as how many years you’ve been trading, your assets and what you’re using the funds for. Repayments are made either daily or weekly.
I already have a loan with another lender, can Bizcap help me?
Absolutely. Many of our clients have loans with other lenders.
What are the interest rates, and how are they determined?
It differs from client to client. We call it a Factor Rate, and it’s a fixed fee on the term of the loan. It’s based on the risk assessment on your loan and, as you build a relationship with us, that Factor Rate will decrease. Your interest rate will depend on several things, including your cash flow, how long you’ve been in business, your assets and what you intend to use the funds for.
Will you check my personal finances?
No. We’re not a personal lender, so we don’t need to check your personal finances – unless your business transactions are going into your personal account. We just need your business bank statements. We will, of course, check the credit reports of the business and its owner(s).
What if I’m a startup business?
We usually need a minimum of six months’ trading history, however, if you have an existing business and need funding for a new venture, please get in touch and we’ll be able to quickly assess whether we can help you or not.
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