Flexibility provides added security that suppliers and wages will still be paid when cash flow gets tight and that businesses can expand by using extra funds to tender for new jobs.
Businesses also have the ability to negotiate better terms and discounts with suppliers if they have cash available for larger upfront payments that is not tied up in loan repayments.
Being able to choose the frequency of loan repayments, as well as the ability to make extra repayments will often depend on whether the loan has a fixed or variable interest rate.
However, regardless of the interest rate chosen, businesses should negotiate to ensure their repayment options are best suited to their financial needs.
Whether a business opts for weekly, fortnightly, monthly, quarterly or even yearly repayments can depend on many things, including cash flow and stability.
Also important to business owners deciding to lend is the ability to decide between principal and interest or interest only repayments.
It is essential that a business chooses a loan with flexible repayment options to ensure they can best tailor the loan to suit their needs.
A business built on flexibility will be best tailored to deal with fluctuations in business activity and profitability.
An ANZ Small Business Specialist can assist you with every aspect of your business finances, including managing your cash flow, applying for a business loan, consolidating your banking and streamlining your accounts. If you would like to find out how you can grow your business through finance please go to www.businessloans.anz.com to find out more.
This is sponsored by ANZ.
Australia and New Zealand Banking Group Limited ABN 11 005 357 522 (ANZ). This is general information only. Its content is for information purposes only, is subject to change and is not a substitute for commercial judgment or professional advice. This material does not take into account your personal and financial needs and/or circumstances, and you should seek appropriate advice (which may include property, legal, financial and/or taxation advice) before considering any material further. ANZ recommends you read the relevant Terms and Conditions and the Financial Services Guide before acquiring any product. To the extent permitted by law, ANZ disclaims liability or responsibility to any person for any direct or indirect loss or damage that may result from any act or omission by any person in relation to this material.
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