Business loans for cafes: what lenders look for when you run on daily takings

A cafe takes money every single day it opens, which makes it look like an easy borrower. Lenders don’t always see it that way. They see thin margins, rising wages, a lease that might be shorter than the loan, and an industry where plenty of businesses close each year. The good news is that a well-run cafe can answer every one of those worries, often with nothing more than its own bank statements.

This page explains how lenders read a cafe, what owners typically borrow for, how the changes of 2026 affect the numbers, and which finance fits which job.

How do lenders view cafes?

Hospitality sits on most lenders’ cautious list. ASIC figures show accommodation and food services had the second-highest number of company insolvencies of any industry in 2025–26, behind only construction. So expect questions, but also expect a fair hearing if your trading is steady.

What helps a cafe’s case:

• Visible daily takings. Card settlements land in your account every day. That gives lenders a granular picture of trade that many other businesses can’t offer.
• A long lease. Lenders want the lease (with options) to run comfortably beyond the loan term. A cafe with eighteen months left is a much harder sell than one with five years plus options.
• Experience. Owners who have run or managed cafes before are viewed far more favourably than first-timers.
• A margin you can explain. Lenders like to see that food and beverage costs, wages and rent are under control as a share of sales.

What concerns them: falling takings, frequent overdrawn days, several online loans already running, and ATO debt without a payment plan.

What do cafe owners usually borrow for?

Purpose	Finance that usually fits	Why
New fit-out or refurbishment	Equipment finance for kitchen items, plus a business loan or property-secured loan for building works	Equipment can secure itself; joinery and building works usually can’t
Espresso machine and grinders	Equipment finance or chattel mortgage	Spreads the cost over the useful life of the machine
Buying an existing cafe	Business acquisition loan, often with property security	Sized on verified takings and the lease
Quiet season or wage rise	Business line of credit or unsecured business loan	Covers a temporary gap
A short, specific project	Merchant cash advance	Repaid from card takings, but often costly
Second site	Property-secured or larger unsecured lending	Lenders look at the first site’s track record

Our guide to funding a commercial kitchen fit-out goes deeper on splitting fit-out costs between equipment and building works.

What changed for cafes in 2026?

Several shifts this year affect the figures a lender sees.

The surcharge ban. Since 1 October 2026 you can no longer add a surcharge when a customer taps an eftpos, Visa or Mastercard debit, credit or prepaid card, and American Express has made a separate call to scrap surcharges as well. For a cafe where most customers tap, the cost of accepting cards now comes out of your margin unless you lift menu prices. The Reserve Bank has also cut the interchange fee caps and expects small businesses to benefit most from lower card costs over time. Lenders reviewing your statements over the next year will see that shift in your margins, so it helps to be able to explain how you’ve priced for it.

Wages. Award minimums climbed 4.75% in July after this year’s Fair Work Commission review. Multiply that across Saturday, Sunday and public holiday penalties and a busy cafe’s weekly wage bill moves by a real amount.

Payday Super. Super is no longer a quarterly bill. Each time staff are paid, their super has to follow and reach the fund within a week or so of business days. A cafe that once used three months of accrued super as a silent buffer now sees smaller, more frequent payments leave the account.

Coffee costs. Green bean prices hit record levels in early 2025 and remain well above where they were before 2024, so many cafes have raised coffee prices more than once. Lenders aren’t troubled by price increases; they’re troubled by margins that shrink because prices didn’t move.

If one of these changes has left a cash gap, a quick enquiry is the easiest way to see your options. Sixty seconds of typing, and your credit file stays closed while we look.

Which risks and seasons do lenders weigh?

Every cafe has a rhythm, and lenders want to see that you know yours.

• Location-driven seasons. Beach and tourist cafes peak in summer and school holidays. CBD cafes thin out over Christmas and January, and on days when office workers stay home.
• Weather. A wet weekend can cut takings sharply for cafes that rely on outdoor seating.
• Lease events. Rent reviews, make-good obligations at the end of a lease and landlord redevelopment can all hit at once.
• Equipment failure. A broken espresso machine on a Saturday morning costs far more than the repair bill.
• Compliance. Since December 2023, cafes preparing and serving ready-to-eat food generally need a certified food safety supervisor and trained food handlers under Food Safety Standard 3.2.2A. A clean record with your local council matters to lenders and buyers alike.

Use our break-even calculator to work out how many sales a day you need to cover costs, including any new loan repayment, before you commit.

Is a merchant cash advance right for a cafe?

Merchant cash advances are marketed heavily to cafes, because the lender can take repayments straight from card takings. Speed is the appeal, and the deductions flex with trade: a rainy Tuesday takes less than a packed Sunday.

The catch is price. Advances are often quoted as a factor rate, and because repayment can be quick, the true cost is easy to underestimate. Add up every dollar you’ll hand back, then set that beside what an ordinary term loan or revolving facility would cost for the same sum. Where an advance is already in place, think hard before adding a second. Lenders read stacked advances as a warning sign.

What should a cafe owner prepare?

• Your POS sales reports and merchant settlement summaries, alongside the matching trading account statements
• The lease: years left, option periods and when the rent is next reviewed
• A current P&L, with lodged returns if you have them
• Supplier quotes for the machine, cool room or joinery you want to fund
• If you’re buying: the contract of sale, the seller’s own figures and statements, and what the landlord requires to assign the lease
• What the ATO portal shows you owe, and any arrangement in place
• If a home or investment property might back the loan, its address and what’s owing

An example: buying a second cafe

Fictional cafe and invented numbers, for illustration only. An owner has run a successful suburban cafe in Adelaide for four years, taking around $14k a week. A second cafe nearby comes up for sale at $260k including equipment, with six years left on its lease plus a five-year option.

The owner has $60k saved. The bank likes the existing business but would want a full valuation of the owner’s home and up to six weeks to approve, and the vendor has another buyer interested. A non-bank lender reviews twelve months of both cafes’ bank statements and point-of-sale data and offers an acquisition loan of $200k, with the owner’s house as security behind the existing home loan. The owner also finances a new grinder and display fridge separately on equipment finance, keeping cash free for the first month’s wages and stock. Twelve months later, with both cafes trading well, the owner plans to refinance to the bank at a lower cost.

Ready to fund your cafe’s next step?

Whether it’s a new machine, a refit, a second site or a cushion for the quiet months, the right finance should fit the way your cafe actually trades. We work with hospitality owners regularly, including those whose bank has said no or couldn’t move in time.

The enquiry takes about as long as pulling a double shot, and your credit history is left alone when you send it. Your details go to us, not to a long list of finance companies, so the phone won’t start ringing off the hook mid-service. Someone on our team reads about your cafe and calls to talk through what’s realistic. Take a moment to get the takings, lease dates and existing debts right on the form, because accurate details are how we find a fit on the first try.

Ask what your cafe could borrow →