Refinancing stacked short-term business debt

It usually begins sensibly. The bank says no, so you take a short-term online loan to cover a slow month. Repayments come out every weekday. Then a big supplier bill lands, so you add a cash advance against your card takings. Then another loan to smooth the first two. Each one made sense on the day. Together they’re taking money out of the account faster than customers put it in.

That’s stacking, and it’s one of the most common reasons good businesses end up in real trouble.

Why does stacking hurt so much?

It’s the frequency and the overlap more than any single facility:

• Daily or weekly repayments start immediately, before any benefit from the funds arrives.
• Several lenders mean several deductions hitting the account on the same days.
• Deductions from card takings reduce the cash from every sale.
• Short terms mean large repayments relative to the amount borrowed.
• Each new facility is sized to cover the last, so the total keeps growing.

The Reserve Bank’s October 2025 Bulletin noted the growth of non-bank lending to small businesses, including newer products such as revenue-based financing. Used once for a clear purpose, these can be useful. Stacked, they can become a trap.

How does a refinance break the stack?

Before the refinance	After the refinance
Several lenders, each with its own deductions	One lender
Daily or weekly repayments	Repayments matched to how the business earns
Card takings reduced by an advance	Full takings back in the account
Each facility renewing or topping up	A defined term and a defined exit
Several registrations over business assets	Old registrations released after payout

The new lender gets written payout figures from each existing lender and pays them directly at settlement. Where the old lenders registered security interests over business assets, those registrations should be released once they’re paid; you can check the Personal Property Securities Register afterwards.

Which refinance fits?

Property-secured refinance. Property-secured business loans from $20,000 to $5,000,000 give the most room to consolidate a larger stack, and usually a more comfortable repayment schedule. First mortgages, second mortgages behind your bank, or caveat loans are all possible. See using property equity to rescue a business.

Unsecured refinance. For smaller stacks and businesses with steady turnover, unsecured and cash-flow options (typically $5,000 to $500,000, sized on turnover and bank statements) can replace several short-term facilities with one. See unsecured loans with bruised credit.

Refinance plus a buffer. A line of credit alongside the refinance can cover the lumpy weeks that caused the stacking in the first place.

To find out which fits your stack, start a 60-second enquiry. There’s no credit check when you first enquire.

What will the lender want to see?

1. A list of every facility: lender, balance, repayment amount, frequency and end date.
2. Written payout figures, including any early repayment costs.
3. Six to twelve months of bank statements, which will show the repayments clearly.
4. Why the stack built up: a slow season, a bank decline, a big job paid late.
5. Proof the business is profitable once the expensive repayments are removed. Lenders often rebuild your cash flow without them to check this.

Be complete. A lender who finds an undisclosed facility on the bank statements will ask why it wasn’t mentioned, and that slows everything.

What if the ATO is also in the stack?

It often is, because the repayments crowd out BAS payments. A refinance can pay the ATO balance at the same time. The ATO can issue garnishee notices to third parties who owe you money, and its garnishee guidance notes that for businesses this can include merchant facility amounts. Clearing the tax balance as part of the refinance removes that risk.

Illustrative example: four facilities to one

Illustrative only, not a real client. A Perth restaurant owner took a short-term online loan after the bank declined a fit-out top-up, then a cash advance against card takings, then two more short-term loans over nine months. Four sets of deductions were leaving the account most weekdays, and a BAS payment had slipped.

The owner has equity in an investment unit. A specialist lender provides a second mortgage, pays out all four facilities and the ATO balance at settlement, and sets a single monthly repayment. The restaurant’s full card takings flow back into the business account.

How do I avoid stacking again?

Refinancing fixes the stack; habits stop it coming back. Put a small buffer in place, such as a line of credit or a cash reserve built from the repayments you no longer make. Keep tax and super money in a separate account. Say no to unsolicited offers of fast finance for a while, because they tend to arrive just when the account looks healthy again. And if a bank has declined you, find out why before reaching for the next fast option. Our decline decoder is a good place to start.

Let’s turn many repayments into one

Stacked debt is fixable, and untangling it is some of the most satisfying work we do. List your facilities in a quick enquiry; there’s no credit check when you first enquire. We won’t add more lenders to your inbox, which matters when you’ve had enough of them, and a specialist calls to go through the stack.

Please list every facility accurately, even the small ones. That’s how we get the payout right first time. See if you qualify →