Getting a R100 000 Business Loan in South Africa

Getting a R100k business loan in South Africa is becoming easier every day thanks to the increasing number of lenders on the market, ranging from banks, to fintech companies and government lenders.

Whether you’re looking for working capital, cash for an inventory purchase or to purchase business equipment, R100 000 can go a long way towards helping small businesses grow or stabilize. In this article we’ll take a look at how your small business can secure a R100,000 business loan in South Africa.

Benefits of a R100k Business Loan

R100k is a figure we frequently see when businesses apply for loans. It could even be considered the ‘sweet spot’ of business loans. The loan amount is low enough to comfortably settle in the short term, small enough to increase the odds of getting the loan approved, and big enough to make a difference to the stability and growth of your business.

Common uses for a R100k business loan include:

100K Unsecured Business Loan Example

Tumi wanted to expand her nail salon. 

This meant renting a new, larger business premises in a better location. To secure the new business location Tumi had to pay a month’s rent of R15,000 up front as well as two months’ rent as a deposit. She also needed to purchase more tables and chairs so her beauty therapists could handle more clients at one time. 

Tumi approached a lender for a R100 000 business loan over 3 months. She was granted an unsecured business loan based on her business turnover. She paid the loan back in three installments according to the table below.

Business Loan Repayment Schedule (R100K over 3 Months)

Payment #	Due Date (Month)	Payment Amount	Principal	Interest	Outstanding Balance
1	End of Month 1	R37,833	R34,000	R3,833	R66,000
2	End of Month 2	R35,333	R33,000	R2,333	R33,000
3	End of Month 3	R35,333	R33,000	R2,333	R0
Total		R108,500	R100,000	R8,500

This cash injection gave Tumi the capital she needed to achieve her goals. The expansion of her business paid for itself. The extra income she earned covered the costs of the loan repayments over the three month term.

Comparing Lenders for R100,000 Business Loans

With dozens of lending options on the table when looking for R100k business loans and each application taking up time and energy, it’s best to narrow down the business lending option that will work best for your business.

Comparing Working Capital Lenders Comparison

Feature	🏦 Traditional Banks	💻 Alternative Lenders (Online, Fintech)	🏛️ Govt / Development Funders (e.g., DFI, IDC, SEFA)
Interest Rates	6–12% p.a. (prime-linked)	10–35% p.a. (risk-based)	4–10% p.a. (often subsidized)
Loan Terms	1–5 years	3–12 months	1–10+ years
Loan Amount Range	R100k – R10m+	R20k – R5m	R50k – R50m+
Collateral	Often required	Sometimes required (depends on lender)	May require collateral or equity contribution
Approval Time	2–8 weeks	1–5 days	2–12+ weeks
Documentation	Extensive: financials, bank statements, tax	Light: 3–12 months’ statements, ID, CIPC	Extensive: business plan, projections, B-BBEE, etc.
Credit Score Requirement	High (650+)	Flexible / varies (600–650+)	Varies, but often includes non-financial assessment
Use Cases	Long-term capital, asset financing	Working capital, quick access	Startup/growth funding, social/developmental impact
Best For	Mature businesses with strong credit	SMEs/startups needing fast, flexible access	Early-stage or underserved businesses
Processing Complexity	High	Low to Medium	High

Pros and cons by lender type

Lender Type	✅ Pros	⚠️ Cons
Traditional Banks	– Low interest rates – Large loan amounts – Reputable institutions	– Slow processing – Strict criteria – High documentation burden
Alternative Lenders	– Fast approval – Easier application – Flexible requirements	– Higher rates – Shorter repayment terms – Smaller loan sizes
Govt/Dev. Funders	– Low/subsidized interest – Support for startups & underserved SMEs	– Long processing – Heavy paperwork – Funding tied to specific sectors

Best Options by Scenario

Business Need / Profile	Best Lender Type	Why
Quick cash flow relief	💻 Alternative Lenders	Fast processing, low doc requirements
Large working capital (R6m+)	🏦 Traditional Banks or 🏛️ Dev. Funders	Larger loan capacity and long-term repayment
New business/startup (less than 2 yrs)	🏛️ Govt / Development Funders	Leniency on credit score, development-focused mandates
Black-owned SME (South Africa)	🏛️ SEFA, NEF, IDC, etc.	Tailored funding programs, often B-BBEE aligned
Tech startup with low assets	💻 Alt. Lender	Flexible on collateral, quick capital
Stable business with good credit	🏦 Traditional Bank or 💻 Alt. Lender	High trust, scalable funding

Risks and consideration

R100k business loans carry inherent risks if you default:

• Asset-based loans: Defaulting may lead to losing the asset securing the loan, often worth more than the loan itself. Only pursue this option if you expect cashflow to stabilize during the loan term. If you’re experiencing an extended cashflow squeeze then selling the asset outright may be better to cover expenses without repayment pressure.
• Unsecured loans: Defaulting can harm your credit score, limit future borrowing, and increase the risk of legal action from lenders. Only consider if you anticipate improved cashflow within the loan period.

For both options above, regular repayments (weekly or monthly) are required, often partially funded by the loan itself. If cashflow doesn’t recover, you may experience the loan itself as an additional expense and financial burden, and may struggle to cover operational costs while meeting repayment obligations.

On a more positive note, if you can afford the loan then interest payments on business loans may qualify as tax-deductible expenses, lowering your business’s tax liability and effectively reducing the cost of borrowing by decreasing taxes on business profits.

How to Get a R100k Business Loan

There are two ways you can get a R100k business loan depending on whether you are applying for a secured or unsecured loan.

Unsecured loan

• Gather the basic documents you’ll require for your application, including CIPC number, tax number, proof of address, ID document and 3 months bank statements.
• Identify which unsecured business loan provider you wish to approach and complete their application form. 
• Alternatively use a business loan broker like Prospa to submit your application and they’ll distribute your application amongst their loan provider network, saving you the time and effort of repeat applications.
• Wait for your loan to be approved on terms that are satisfactory to you.
• Once you have approved the loan the funds will be disbursed into your bank account.
• Make your monthly repayments on your loan.
• At the completion of your loan term you may have the option to redraw the loan amount.

Secured loan

• Gather the basic documents you’ll require for your application including title deed for the asset that will be used as loan security, proof of address and ID document.
• Identify which provider of secured loans you wish to approach for a loan and submit your application or use a loan broker to assist you in distributing your application to several lenders at once.
• Your asset will typically need to be inspected and its value verified. You will then be presented with a loan offer based on the value of your asset.
• Once you have approved the offer the loan will be paid out into a nominated bank account.
• Moveable assets will be transferred to the safekeeping of the loan provider for the loan term. Title deeds will be held as security for immovable assets.
• Make monthly repayments on your loan.
• At the end of the loan term you may be able to redraw the full loan amount.

Need a R100k business loan? Apply with Prospa now!

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