Unsecured Business Loans vs Invoice Financing

Unsecured Business Loans vs Invoice Financing

Running a successful business requires not only dedication and hard work but also adequate financial support. At Premier Finance, we understand the challenges entrepreneurs face in accessing the necessary funds to fuel their growth and expansion endeavors. That’s why we offer two distinct financing solutions tailored to meet varying business needs: unsecured business loans and invoice financing. Let’s explore the differences between these two options to help you make an informed decision for your business.

Unsecured Business Loans

When it comes to securing quick and flexible funding for your business, unsecured business loans are an ideal choice. These loans offer the following features:

Loan Amount Available: From R20,000 up to R10 000 000

Repayment Period: Flexible repayment terms ranging from 3 to 12 months, with an early settlement benefit.

Interest Rates: Competitive interest rates ranging from 2% to 6% per month on the outstanding balance.

Business Requirements: To qualify for an unsecured business loan, your business must meet the following criteria:

Registered Business/VAT registered Sole Trader.

Trading for at least 1 year (no startups).

Annual turnover of at least R1,000,000.

Clear credit record.

Sufficient discretionary income to service loan payments.

Invoice Financing

Invoice financing, also known as invoice discounting, provides a cost-effective solution to access funds tied up in your accounts receivable. Here’s what you need to know about this financing option:

Create Liquidity Fast: Invoice financing helps you access immediate working capital by converting outstanding invoices into cash.

Requirements: To qualify for invoice financing, your business must meet the following criteria:

Registered South African company or closed corporation.

Annual turnover of R1 million or more.

Minimum 1-year trade history.

Benefits: Enjoy the following benefits with invoice discounting:

Access to funds ranging from R10,000 up to R50 million.

Fast application and disbursement process.

Key Differences

While both financing options serve to address your business’s financial needs, there are some key differences to consider:

Basis of Finance: Unsecured loans are based on your business’s current cash flow position and disposable income, whereas invoice financing relies on completed work and outstanding invoices.

Approval Process: Invoice financing considers the debtor’s approval, making it easier for companies to unlock funding that may not qualify for unsecured loans.

Repayment Structure: With unsecured loans, funds are repaid over 3-12 months, with the option to settle early without penalties. Invoice financing is settled when the client pays the invoice, with up to 80% of the invoice total discounted.


At Premier Finance, we offer both unsecured business loans and invoice finance to cater to diverse business needs. Whether you need quick financing based on your current cash flow or wish to leverage outstanding invoices for immediate working capital, we have the solution for you.

Explore our services today:

Invoice Financing

Unsecured Business Loans

Empower your business with the financial support it deserves. Reach out to us to discuss your financing needs or download our business finance guide.

Best regards,

Judy Hayes

Email: judy@premierfinance.co.za

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