A practical guide to asset based finance for Australian business owners, brokers and advisors. How it works, who it's for, what it costs, and how it differs from asset finance, bank lending and cash flow funding.
Asset based finance is short-term commercial funding assessed on the value of an asset, not on the borrower's credit file or financials. For asset-rich, cash-poor businesses, it's a faster path to capital than a bank can offer.
Asset based finance is a category of commercial lending where a loan is secured by, and assessed against, the value of a business or personal asset rather than the borrower's credit history, trading record or financial statements.
The category is also called asset based lending, asset-backed finance, asset-secured lending, or simply a cash-out solution. They all describe the same model: the asset is the basis of the decision, and the loan is secured against it for the duration of the term. Asset finance providers and asset finance companies in Australia generally fall into two buckets — those who fund the purchase of a new asset (chattel mortgage, hire purchase, lease), and those who lend against assets already owned. ABL is the second kind.
In Australia, asset based finance typically runs from $20,000 to $1 million in loan size, with terms of 1 to 9 months. Lenders advance up to 70% of the asset's value, with same-day settlement standard once the asset is secured.
The model exists because commercial finance needs a faster lane. Bank business loans take 4 to 8 weeks. Cash flow lenders take 5 to 10 days. Asset based finance takes hours. For businesses with an asset and a time-critical need, that speed is the entire product.
Asset based finance isn't a general-purpose business loan. It's purpose-built for specific situations where speed matters and an asset is available.
Tax debt is escalating, a Director Penalty Notice has landed, and the bank won't lend with ATO arrears on the books. Tax debt situations are one of the most common asset based finance use cases in Australia.
Long-term financing is in progress but settlement is weeks away. Asset based finance bridges the gap without adding to the long-term debt structure.
A deal closing, stock at the right price, equipment available now. The opportunity is real but it won't wait for a four-week bank process.
The business needs short-term capital to execute a restructure or fund a voluntary administration without taking on long-term debt that compounds the problem.
Asset based finance sits between bank lending and unsecured non-bank lending. Each option solves a different commercial finance problem.
| Bank business loan | Cash flow finance | Asset finance (purchase) | Asset based finance (ABL) | |
|---|---|---|---|---|
| What it funds | General business need | Working capital | New asset purchase | Cash against existing asset |
| Assessment | Credit + financials | Trading history | Asset + serviceability | Asset value only |
| Credit check | Yes | Yes | Yes | No |
| Time to funding | 4–8 weeks | 5–10 days | 3–14 days | Same day |
| Loan term | 3–30 years | 3–24 months | 1–7 years | 1–9 months |
| Best for | Strong financials, long-term need | Steady trading, working capital | Buying a new asset | Asset-rich, time-critical |
For deeper comparisons, see our guides on asset based finance vs bank lending and asset based finance vs asset finance.
ABL is built specifically for asset based finance, not a general lender that also takes asset security. One product, done properly. Operating from locations across Australia.
Five steps from enquiry to funds in your account. Most asset based finance deals settle inside 48 hours.
Truck, machinery, equipment, stock, art, gold. We value it the same day.
Issued within 2 hours. Costs upfront, no surprises.
Stored with us via Lloyds, or kept in service with GPS tracking fitted.
Funding released the same day once the asset is secured.
Exit any time after month one. Repay early, get the asset back.
We work with brokers and advisors across Australia who use asset based finance to solve client situations the banks can't.
The questions we get most about asset based finance in Australia. Call us if yours isn't here.
Indicative terms within 2 hours of enquiry. Same-day settlement once the asset is secured. No paperwork to gather, no credit check, no commitment to call.
