You can't make the repayment this month. Here's the order to act in

It’s the 24th and the repayment comes out on the 28th. The account doesn’t have it. A client paid late, a tax bill landed, or a quiet month ran longer than planned.

Nearly every business that borrows faces this at some point, and what happens next depends more on the next few days than on how big the shortfall is. Here is the order that tends to work.

What should you do in the first 48 hours?

1. Work out the real gap. Is it the whole repayment, part of it, or just timing? Look at what’s due in the next 30 days and what is realistically coming in. A shortfall of $3k for two weeks is a different conversation from a $15k shortfall for three months.
2. Check what’s in the contract. Find the repayment dates, grace periods, default clause, fees and any cross-default terms (a missed payment on one loan triggering a default on another).
3. Decide what you can offer. Lenders respond to a proposal. “I can pay half on the 28th and the rest on the 12th” is easier to approve than “I’m struggling”.
4. Contact the lender before the due date. Phone, then confirm in writing. Say what happened, what you propose and when you expect to be back on track.
5. Get free advice in parallel. The Small Business Debt Helpline on 1800 413 828 offers independent, confidential counselling. ASBFEO’s debt guide explains the options in plain English.

If any part of the shortfall is tax, tell the ATO as well. It generally works with businesses that engage early; see how to deal with an ATO debt.

What can you actually ask your lender for?

Be specific. Common requests, from lightest to heaviest:

Request	What it does	When it fits
Move the payment date	Shifts a single instalment by days or weeks	Timing problem, such as a late-paying customer
Skip or defer one or more payments	Adds the missed amounts to the balance or end of the term	Short disruption with a clear recovery
Interest-only period	Cuts the instalment for a set time	Seasonal dip or a temporary revenue loss
Extend the term	Spreads the balance over more months	Ongoing pressure, though total interest rises
Restructure or consolidate	Combines debts into a new schedule	Several loans squeezing cash flow
Release or substitute security	Frees an asset to sell or refinance	A planned sale that clears the debt

Each of these has a cost, and the cost is usually more interest over the life of the loan. Ask the lender to show you the total repayable in dollars under the old and the new arrangement. Our interest-only business loans explained shows what that trade looks like.

Our dedicated page on how to ask a lender for hardship help includes a structure for the request letter.

Will your lender have to help?

It depends on who they are and what you signed. The 2025 Banking Code of Practice, effective from 28 February 2025 and developed by the Australian Banking Association, broadened what counts as financial difficulty. It now includes finding it difficult to meet current or future repayments because of causes such as illness, job loss, a pandemic or natural disaster. It applies to the banks that subscribe to it and to small business customers within its borrowing and size limits, which were widened in the 2025 update.

Many consumer hardship protections in credit law don’t extend to business loans, so a non-bank business lender may have no obligation to pause anything. Some will, because a lender that keeps a viable customer paying earns more than one that forces a sale. Banks are often the best-placed to offer a restructure, and if your bank is willing, take the offer seriously.

If you feel a lender has ignored your request or acted unfairly, the route is its internal complaints process, then the Australian Financial Complaints Authority. Our guide to AFCA and small business disputes explains the limits and time frames.

What does a lender see on your side?

Lenders decide quickly whether you’re a temporary problem or a permanent one. Show them:

• The cause, in two sentences: late payer, lost contract, storm damage, a one-off tax bill.
• The evidence, such as the invoice that’s outstanding or the signed new contract.
• A short cash flow forecast for the next 13 weeks showing when you’re back on track. Our guide on building a 13-week cash flow forecast shows how.
• Your own action, such as reduced drawings, deferred spending or chasing debtors.
• A proposal with dates and amounts.

Treating the lender as a partner rather than an opponent usually pays off; how to keep a lender on side goes into tone and timing.

What if you’ve already missed the payment?

Don’t wait for the lender’s next letter.

• Call today and ask what the arrears are and what fees have been added.
• Ask for the arrears to be cleared over a schedule, not in one hit.
• Read any default notice carefully. It states how long you have to fix the problem and what the lender will do if you don’t. Treat that date as final.
• Keep every other obligation current. Wages, super and tax are the debts that can create personal liability for directors. See what a director penalty notice means for you.
• Understand where this leads. What happens if your business loan defaults describes the stages, and the arrears glossary entry covers the term.

If a default has been listed on your credit file, there are steps to get it corrected or cleared once the debt is settled. See how to remove a default from your credit file.

Should you borrow to cover the gap?

Sometimes, and sometimes it’s the worst move. A loan can solve a timing problem when the debt it creates is cheaper or longer than what it replaces. It makes things worse when it’s expensive, short and stacked on top of existing repayments.

Test any offer with three questions:

1. What is the total I’ll repay, in dollars, compared with the debt I’m clearing?
2. What happens to my weekly or monthly cash flow after this, not just this month?
3. What happens if the same shortfall happens again in three months?

Our guide on how to avoid panic borrowing goes through the common traps, such as daily repayments that quietly drain the account. If expensive short-term debt is the cause of your squeeze, a refinance may release cash. See refinancing out of expensive debt and our situation page on refinancing expensive short-term business debt.

A worked example: three weeks of breathing room

Consider an illustrative bakery with a $90k equipment loan, repayments of $2,400 a month, and a wholesale customer owing $18k that has slipped from 30 to 75 days. The owner can see the March repayment bouncing.

• On the 20th, she phones the lender and follows up by email: “A $18k invoice is overdue by 45 days; I expect payment by 15 April; I’m asking to move the March repayment to 18 April and will pay April’s on time.”
• She sends the invoice, the customer’s remittance confirmation date and a two-page forecast.
• The lender agrees, charges a small administration fee, and notes the file.
• She uses the time to invoice more promptly and offer a small discount for early payment. Our guide on getting customers to pay faster goes through those moves.

Nothing about this required a new loan. What it required was a phone call before the 28th.

If the call doesn’t get you there, or the shortfall is bigger than a timing slip, tell us what’s happening. We’ll look at what could work, and enquiring doesn’t touch your credit file.

Getting a second opinion on your options

Sometimes the right answer is to renegotiate. Sometimes it’s a refinance onto better terms, and sometimes it’s a short bridge while a big invoice lands. The sooner you look, the more of those are still open.

The enquiry takes about a minute, and a quick look from us won’t touch your credit score. We keep your details with us rather than spreading them across a list of lenders. A person reads what you’ve told us and phones you to talk it through. Be as accurate as you can about what you owe, what’s overdue and what security is in place, so the first suggestion we make is the one most likely to fit.

Talk it through with a real person →