Need Help Finding a Loan?
Find out if you qualify and compare options without a credit check!

Loan Amount:
$
Purpose:
All finance quotes are provided free and without obligation. We respect your privacy.
Knowledgebase
Personal Loan:
a loan that is granted for personal use, normally unsecured and granted by a lender on the borrower's integrity and capacity to repay

Home Loans Fast
Simple online application, fast easy approvals and great service.
Click for details

Personal Loans Australia
Look no further for low rates and fast, free online approval process.
Click for details

Compare Personal Loans
Shop multiple lenders for best offers. Free online eligibility assessment.
Click for details

Poor Credit? No Problem!
Let us help you find the right loan even with less than perfect credit.
Click for details

Personal Loans Fast
Free personal loan finder service. Best deals for online applicants.
Click for details

Low Rate Loans
Finding the best rate loans loans has never been easier. No upfront fees.
Click for details

Finance-Australia.net :: Articles
SHARE

Share this article with your friends!

Business Loans: Managing interest rate risks

Business Loans: Managing interest rate risks

"I want the protection in the current low interest rate environment but I don't want to be locked in for too long a period" - a commonly heard requirement from business borrowers.
Businesses can often find themselves adversely affected by interest rate changes.

Fixed or variable?

Choosing either a fixed or variable interest rate may not provide the perfect solution for your interest rate needs.
Whilst fixed interest rate borrowers cannot benefit from any interest rate falls, variable interest rate borrowers may find that they are exposed to the risk of rising interest rates.
Successful businesses are continually required to meet increasing demands requiring greater sophistication.

Strategies

Business Plant & Equipment Finance
Looking for the best way to finance your business plant & equipment? Well, you need look no further! Simply submit our 2-minute business loan enquiry form ... and we'll help get you qualified for the best rate Plant & Equipment loan available from our national panel of independent business finance brokers. We also have access to the best rates & options for Business Cashflow finance. So, why not give us a go ... no charge, no obligation!
Many institutions are able to respond to sensitivities to interest rate movements with customised interest rate risk management strategies to suit your business.
To find the strategy that best fits your requirements you should consider whether, overall, you need the flexibility of a variable interest rate, or the certainty of a fixed interest rate.
There are many innovative interest rate, risk management products in the Australian market designed for the current interest rate environment offering businesses:
  • flexibility.
  • the ability to minimise interest rate risk.
  • interest rate protection with the ability to benefit from lower interest rates.
Larger institutions offer Business Bankers and Risk Management Specialists as part of their service to help identify financial products which may help reduce interest rate risk and uncertainties facing business borrowers.
For example Flexible Maturity Fixed Rate Bills provide a known fixed rate for a total term, say, five years.
The first three year period is fixed plus an optional two year extension period.

Capped Rate Bill

Another example is a variation of the standard Capped Rate Bill, where the customer pays a premium either up-front or in arrears and gives the borrower a known maximum cost of borrowing.
For example if the borrower has a set view on interest rates, or would like to take out some "disaster insurance", the Pay-If-Used Capped Rate Bill provides maximum known interest rate protection from interest rate rises for up to five years – and the business pays for it only if the cap rate is reached.

Think ahead

Try to identify peaks and troughs in cashflows to forecast business needs.
The institution may be able to provide specialised borrowing alternatives in periods where seasonal requirements fluctuate.
A new borrowing strategy may help you to conserve much-needed cash during the post-Christmas period and use credit funds (and not over-draft) to make loan repayments during the month.

Share this article:

Could your business use some extra cash?
Whether you need an injection of funds to help tide you over tough times or to provide some much needed working capital during a growth stage, our panel of Business Loan specialists are standing by for your enquiry. Our broker panel will give you access to the best available bank and non-bank lenders with rates often lower than are available direct.
Farm Equipment Finance and Loans
Looking for the best way to finance your Farm Equipment? Well, look no further! Simply submit our 2-minute business loan enquiry form ... and we'll help get you qualified for the best rate Plant and Equipment loan available from our national panel of independent business finance brokers. We also have access to the best rates and options for Business Cashflow finance for Farmers.


Finance Articles

Credit Cards: Identity Theft and Credit Protection Credit Cards: Identity Theft and Credit Protection
Credit card fraud and identity theft have become widespread not only on the Internet but offline as well. Learn how to avoid these risks and protect your identity as well as your finances or credit line. - read more
How Credit Card Balance Transfers Can Damage Your Credit Rating How Credit Card Balance Transfers Can Damage Your Credit Rating
Since the banks and finance providers have been castigated for the way they seemingly indiscriminately awarded credit to people who could ill afford it, the chances of being accepted for loans and credit cards have decreased. Concurrently, there is a greater focus on individual's being aware of how credit works and what their financial behaviors means in terms of a credit score and history. - read more
The Four Golden Rules Of Personal Finance The Four Golden Rules Of Personal Finance
As long as you're alive, you are a player on the field of the 'money game'... and you'll need to know the basic rules before you get tagged by the more experienced players! - read more
Finance News

Interest rates up another 50 basis points with more hikes to come Interest rates up another 50 basis points with more hikes to come
03 Aug 2022: .

As expected, the Reserve Bank of Australia (RBA) raised interest rates by another 50 basis points this month. The fourth rate hike in as many months, today’s decision takes the cash rate from an emergency low of 0.1% to 1.85%. - read more
Business loans on the rise while mortgage growth remains flat Business loans on the rise while mortgage growth remains flat
02 Jun 2022: .

Australian business loans growth accelerated in April as mortgage growth stayed consistent, with major banks growing at less than the system average according to latest RBA data. - read more
Homebuyers up in the air despite new  government home loan support Homebuyers up in the air despite new government home loan support
29 May 2022: .

The government’s promise of an equity contribution will help the most disadvantaged Australians to get a home loan, but they still won't be able to afford one. - read more