Small business finance in Australia is similar to that in other developed countries. Government support is available to some extent and modern financing options such as venture capital, customer credit, lease finance and receivables factoring are also available. These are in addition to the traditional sources of your own funds, and formal and informal borrowings.
This page comes under the section Small Business in Australia.
Financing is only part of financial management, which involves more than just finding some money. Good financial management involves:
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The Small Business Planning page of this website discusses how to develop business plans. Another page, Small Business Funding, discusses the different options for financing.
We now look at some government programs in Australia for small business.
Australia government assists small businesses through different programs, such as advice and guidance, skills development services and grants. Grants are typically given to organisations that help small businesses to become successful, and rarely to new startups. However, established businesses might be eligible for grants for research & development and expansion.
Assistance is provided by Federal, State/Territory and Local governments through different programs. We have discussed general support in a separate article, Australia Government Support for Small Business. In this article, the focus is on financial support.
Federal government funding is available for different specific projects. A few representative examples are listed below:
The above is only an illustrative list to indicate the specific nature and variety of government funding programs. You can check the "Grants & assistance" page of business.gov.au website or contact your nearest Business Enterprise Centre for checking your eligibility for some grant or other support.
The grants page provides links to state government programs. In the next section, we look at a program of Victoria government
Under this program, government grants are given to organisations that establish projects to "enhance the business skills of small business owners through training, mentoring and incubation". The four key areas eligible for such grants are:
The above is only one example. You might be able to find other programs under which you might be eligible for business assistance. For checking this, you can find a BEC centre near you (Check BEC Website) and meet them for a discussion.
Owner's equity and bank loans are the primary funding sources for small business. However, depending on your circumstances, you might be able to obtain funding from other sources.
Venture Capital: If your plan is for an innovative business with quick and high profit potential, you might be able to interest a venture capitalist to invest in your business. In that case, you can check out Australian Private Equity and Venture Capital Association website. Check out their members directory for business angels, incubators, institutional investors, etc.
Lease Finance: There are numerous companies that offer lease finance allowing you to get equipment, vehicles and other assets on lease instead of outright purchase. You can find many by searching for 'lease finance in Australia'.
Factoring: You can get immediate cash against your credit invoices by discounting the invoices with an invoice factor. You can get more details, and find a suitable factor by going to Institute for Factors and Discounters of Australia and New Zealand Inc. website.
Finance Brokers: The Finance Brokers Association of Australia seeks to implement a code of practice among financiers, and you might get a better financing deal from an accredited member of the association.
Return to Section Main Page The Economic Scenario for Small Business in Australia
Financial reports speak their own language, and managers without a strong finance background often find themselves bewildered by what is being said. Finance for Non-Financial Managers helps managers become familiar with essential financial information, showing them how to "speak the language of numbers" and implement financial data in their daily business decisions.
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