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Xero – your best asset when applying for a business loan or finance

Posted 10 months ago in Xero news by Philip Gardiner
Posted by Philip Gardiner

Many small business owners know too well the struggle of accessing capital to support their business. And while we know there is a range of factors that can contribute to this struggle, one of the biggest issues small business owners face is the onerous loan application.

The good news is that Xero can help streamline the application process, making it easier and faster for small businesses to apply for finance and get funded (if approved).

Integrations built between our platform and many financial institutions’ mean that businesses applying for finance can share their financial reports from Xero directly with a lender during the application process.

How does this help businesses?

We know that when a business needs finance, speed is critical. Before these types of integrations were available, businesses would typically need to manually export and share documentation with lenders in order to be assessed for credit, resulting in a time-consuming process with a lot of back-and-forth required to get the right information to the lender. In fact, one of our users told us that it took more than 10 visits to their bank to get a signature on the loan application.

Does that sound all too familiar?

The ability to share Xero data directly with a lender means small businesses can:

  1. Apply for finance faster. Instead of spending 25 hours on loan paperwork, complete an application online in as little as 20 minutes.
  2. Receive a faster decision. The lender has immediate access to the information they need to assess your application, eliminating all the back-and-forth. The quicker the decision is known, the quicker the small business can act on the opportunity.

How does it actually work?

To share Xero data, a small business just needs to apply online to one of Xero’s lending partners and connect their Xero organisation when prompted during the application. It’s simple to connect – the business owner just needs to enter their Xero login credentials and accept the data-sharing terms at the relevant point. Once the business owner has given their consent, their Xero data, including reports such as the profit & loss report and balance sheet, is shared with the lender. Rest assured the data is shared securely with the lender using multiple layers of protection.

Getting your business finance-ready

There are steps that small business owners can take before applying for finance that can improve their chances of being approved. One of these is to work with their trusted advisor to get their business finance-ready. The Australian Small Business and Family Enterprise Ombudsman’s enquiry into Affordable capital for SME growth recommends this as one of six points.

A key factor in a small business successfully obtaining finance is to demonstrate creditworthiness. This is where their accountant or bookkeeper comes into the equation. The accountant or bookkeeper should help their client to ensure their Xero data is correct, complete and up-to-date before sharing it with a lender. A few easy ways to get it to this stage are:

  • Make sure bank feeds are set up so bank transactions automatically flow into Xero.
  • Use other features in Xero to automate data entry, such as email to bills.
  • Reconcile all transactions regularly.

Having an accountant or bookkeeper oversee and continually certify the accounts will ensure that your Xero data is of the highest quality.

Find out more about Xero’s lending integrations and the benefits of sharing Xero data during a loan application at


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