How to get Bank Funding
Boil It Down: Is It a Good Idea?
When it comes to applying for finance, business owners are often asked one core question: is this a good idea? It really comes down to being able to clearly explain what the money is for, how it will be used, and how it will be paid back. If those questions are hard to answer, it’s probably worth pausing and doing a bit more planning first.
Mistakes to Avoid When Starting Out
A common early mistake for new businesses is not fully understanding their tax obligations. Not budgeting for the first year’s tax bill can land people in tough situations. There’s also a big difference between cash in the bank and cash available to spend. Just because the account looks healthy doesn’t mean it’s time to upgrade the ute or buy a jet ski.
Having a basic plan and budget in place can help you avoid those cashflow traps, especially in the first few years.
Provisional Tax Can Catch You Out
Provisional tax and tax pooling came up in a previous About the Green episode with TMNZ. And for many business owners, it's a confusing system. With three payments due at different times of year and penalties for missing them it’s easy to lose track.
That’s where your accountant can save you. A quick chat can help map out a budget for the year, highlight key dates, and make sure you’re not caught off guard, especially during expensive months like December and January.
If you know those high-expense, low-revenue months are coming, it becomes easier to ask your lender for a temporary facility to bridge the gap and keep your business moving.
Applying for a Loan: It’s Not Just About the Numbers
When a business applies for finance, lenders want to see more than just how much they’re asking for. They want to understand the plan. Whether it’s a $100 loan or a million dollars, the key is whether the request makes sense based on the business plan and financials.
Having serviceability—the ability to meet repayments—is important, but so is clearly explaining what the funds are for. It’s not enough to say "I could repay it." A vague idea won’t cut it in today’s market.
Ask for Help Early
It’s tempting to wait until you’re under pressure to talk to your advisers, but reaching out early makes a big difference. A commercial manager, your accountant, your lawyer—these people are there to help. Having a clear view of your position today, and where you want to get to, makes the conversation smoother with any bank or lender.
Looking Ahead: Preparing for the End of 2025
There’s been a lot of talk about “survive to 25,” but it’s starting to feel like “survive to 26.” With an election year ahead, many business owners expect things to quiet down—but there’s always opportunity.
The key is to stay focused, make clear plans, and surround yourself with good advice. Every industry has its cycles, and businesses that prepare and think ahead are the ones that push through.
Key Takeaways for Business Owners
Don’t confuse cash in the bank with money available to spend.
Know your tax obligations early—especially in your first year.
Talk to your accountant about provisional tax and budgeting.
When seeking finance, be clear on what it’s for and how it’ll be repaid.
No amount is too big or too small—it’s the plan that counts.
Plan for low-revenue months and prepare early for temporary cashflow needs.
Talk to your team of advisers early, not just when things get tight.