The first year of a business is when you need money most and when lenders know least about you. Your bank statements are thin, you probably don’t have annual accounts, and your turnover chart looks more like a staircase than a line. None of that is a problem in itself — it just changes which loans are realistic.
Here’s how we think about funding by trading age.
Which loans are realistic at each stage?
| Trading time | Unsecured funding | Property-secured loan |
|---|---|---|
| Not yet trading | Generally not available | Yes — $20,000 to $1m |
| 0–6 months | Rarely | Yes |
| 6–12 months | Often possible, sized to turnover | Yes |
| 12 months + | Wider range of options | Yes |
0–6 months: lean on security
With only a few months of statements, unsecured lenders don’t have enough to go on. A property-secured loan changes that because the decision rests mainly on NZ property you or a supporting party already own — a home, rental, commercial property or land, as a first or second mortgage. No financials or tax returns are needed for the initial assessment, and bad credit, defaults and arrears are considered case by case.
6–12 months: the unsecured door opens
Once you’ve got roughly six months of business bank statements, unsecured funding and lines of credit become possible. The amount is based on turnover, so a business doing steady monthly deposits will be treated very differently from one with a single big month. Weaker credit is considered and some decisions come back the same day.
At this stage many founders use both: a modest unsecured facility for day-to-day timing gaps, and a property-secured loan for bigger one-off spending like a fit-out or a large stock order.
What lenders look for in a young business
Because there isn’t much history, lenders focus on the signals they can see. Our guide to how lenders assess new businesses goes into detail, but the short version:
- Direction of travel. Are deposits growing, flat or shrinking month to month?
- Account conduct. Dishonours, unarranged overdrafts and bounced direct debits are red flags even when turnover is good.
- Separation. A dedicated business account with only business transactions is much easier to assess.
- IRD status. GST registered and up to date, or on an arrangement, reads well.
- The founder’s track record. Industry experience, previous businesses and personal credit history all fill the gaps.
- A clear use of funds. “$35,000 for a second coffee machine and a cold-drinks fridge for summer” is more convincing than “cash flow”.
Make your first year count
Every month of clean trading makes your next funding conversation easier. A few habits worth starting now:
- Open a business bank account and route all sales into it.
- Pay suppliers and IRD on time — some trade suppliers report to credit bureaus.
- Register for GST when you’re approaching the $60,000 threshold (or earlier if it suits). See our GST threshold guide.
- Keep your company details current on the Companies Office register.
- Use a small trade account or facility and pay it perfectly. The credit profile guide explains why.
Example scenario
Example scenario — generic and illustrative only. A Palmerston North barbershop opened eight months ago and has steady card takings banked daily. The owner wants to add a third chair and a retail wall. Eight months of consistent statements put an unsecured option on the table, sized to turnover. Because the fit-out quote is larger than that, the owner also explores a small property-secured loan against a rental property to cover the gap.
Where to from here
If you’re under 12 months and wondering what’s possible, send an enquiry. It’s about 60 seconds, doesn’t affect your credit score, and a lending specialist will call to talk through which lane fits your stage. Not trading yet? Start with our startup loans page.