The short version
- Equipment finance is the easiest finance for a new ABN to get, because the equipment is the security. Lenders don't need two years of financials when they hold an asset they can value and sell.
- With clean director credit, lenders will write a deal from day one of the ABN. From around six months of trading, low-doc terms open up and pricing gets better.
- Expect a deposit of 10 to 20% and a higher rate than an established business pays. Both drop away as you build trading history.
- Clean deals settle in three to seven business days. That matters when the equipment is what's stopping you from earning.
Say your ABN is eight months old and you need a $60K oven, a coffee machine or a van. The banks want two years of financials you don't have yet. And the revenue that would pay for the purchase can't start until the equipment turns up. Equipment finance is built for this gap. It's the one lending market where "we've only been trading a few months" can still get a yes.
For the wider question of what a new business can borrow in year one, see our guide to startup finance options for a new ABN. This article sticks to finance for machinery, vehicles and commercial equipment for businesses under twelve months old: what lenders look at, and how to set up the deal so the next one costs less.
Why equipment finance works when nothing else does
Equipment finance is part of the wider asset finance category, and the same idea makes it work for new businesses. The lender's security is the asset, not your trading history.
Take a lender funding a $55K commercial kitchen package for a four-month-old café. It isn't relying on two years of profit. It's relying on a director who pays their debts, an asset it can sell if things go wrong, and a deposit that means the owner has money in the deal too. The usual structure is a chattel mortgage. The business owns the equipment from day one, and the lender registers its interest on the Personal Property Securities Register until the loan is paid off. Because you own it from day one, a GST-registered business can claim the GST on the purchase in the next BAS. On a $55K package that's roughly $5K back within a quarter.
Most of the lenders that do these deals aren't banks. Specialist asset-finance lenders have credit rules built for this exact situation, and several will happily lend to new ABNs when the director's credit is clean. That's where a broker earns their fee. From the outside, you can't tell which lender will say yes and which will politely decline.
What lenders look at when there are no financials
Lenders look at four things, roughly in this order.
The director's credit history counts most. With no business track record, the lender uses your personal credit file to judge how the business will behave. They want a clean repayment history and existing debts under control. A director with a strong personal file and a deposit can get a deal in the ABN's first month. A director with recent defaults will find few lenders, however old the ABN is.
The asset comes second. Common equipment that's easy to resell, like kitchen gear from known brands, vehicles, trailers and standard machinery, is easy security. Very specialised or heavily installed items are harder. Custom fit-out, joinery, signage and software sit at the bottom of the list, because they're worth very little once installed. If your purchase mixes both, expect the lender to fund the equipment easily and the fit-out reluctantly or not at all.
How long you've had your ABN and GST registration sets your tier. Day-one deals exist, but they cost the most and depend entirely on the director. From around three to six months of trading, more lenders will look at you. From six to twelve months, bank statements showing real money coming in open up low-doc assessment, where the statements take the place of financials. Being registered for GST helps at every stage because it shows you're actually trading.
The deposit closes the gap. For new ABNs, 10 to 20% is the usual range. It cuts the lender's risk on day one and shows you're committed. A director who won't put 10% into their own equipment sends a signal lenders act on.
What it costs and how the deal is set up
New-ABN equipment finance costs more than it does for established businesses. Think of it as paying extra for missing history, not a penalty. Indicative ranges in August 2026: an established business on full-doc with a prime asset borrows at 7 to 8.5%. A new ABN with a clean-credit director and a new, common asset usually lands between 9.5 and 13%. Older assets, weaker credit files or day-one ABNs push the rate higher. Terms run three to five years. Balloons are available but used sparingly on new-ABN deals, because the lender wants the loan paid down faster than the asset loses value.
Buying from a dealer is simpler than a private sale. The lender pays the dealer directly and the paperwork is standard. Most specialist lenders will still finance private-sale equipment, with extra steps: proof of ownership, a PPSR check on the seller, and sometimes an inspection. Allow a few extra days.
The tax side is the standard chattel mortgage setup: GST credit in the next BAS, depreciation under Division 40, and deductible interest. The instant asset write-off may apply, depending on the limit for the year. The cap has changed often, so check the current figure on the ATO's simpler depreciation page or with your accountant before you count on it.
A worked example
A dessert bar has been trading for eight months and needs a $58K equipment package: a deck oven, two display fridges and a commercial coffee machine, all new and all from a dealer. The director's personal credit file is clean, and the business banks about $32K a month in card takings. The deal is a five-year chattel mortgage with 15% down ($8,700), assessed low-doc on six months of bank statements, at an indicative rate just under 11%. The lender pays the dealer directly and the deal settles in five business days. The business claims the roughly $5,270 GST credit in its next BAS. Repayments come to around $1,070 a month. Next to the revenue the oven brings in, the finance cost isn't what decides this deal.
Eighteen months later, the same business has two years of trading and a clean repayment record on its first loan. If it refinances or adds equipment, it would price 2 to 3% lower and probably without a deposit.
Setting up the next deal
Your first equipment loan also starts your business's credit file, and that builds over time.
Paying the first loan perfectly on time is the best evidence a young business can show the next lender. Lodging BAS on time and keeping bounced payments (dishonours) off the business account do the rest. Keep personal and business banking completely separate. By the two-year mark you'll price as an established borrower, and the conversation moves from the director's personal file to the business itself.
Aurelius Capital arranges equipment finance across a lender panel that includes the lenders who actually lend to new ABNs. Setting up the first deal well is most of the work. If you're pricing equipment and your ABN is young, the application form is below. Most enquiries get a response within four business hours.