Insights

The private lending market continues to mature. Alongside that growth has come greater scrutiny of how loan facilities are structured, documented, and supported over their full lifecycle.

At Finance Law, we work closely with non-bank and private lenders, brokers, and borrowers to design transactions that are commercially effective at origination and remain coherent, defensible, and durable over time. Increasingly, the focus is not simply on documentation, but on whether the structure of a loan genuinely reflects its commercial purpose.

From what we see across the market, several themes consistently stand out.

01

Company loans and genuine business purpose

Where a loan is made to a company for genuine business purposes, the National Credit Code does not apply. This position is well established in Australian credit law and continues to be reaffirmed.

The key consideration is the true commercial purpose of the loan, rather than the form of the documents alone. The involvement of individual guarantors does not, of itself, alter the character of the facility. Careful articulation of purpose at the outset remains central to ensuring clarity and certainty for all parties.

02

Structure should reflect substance

Effective documentation is not about labels or technical form. It is about alignment.

When the structure of a transaction mirrors its underlying commercial drivers and context, it provides predictability and transparency throughout the life of the loan. Misalignment between substance and structure can introduce unnecessary ambiguity and risk, particularly if a transaction is later reviewed or tested.

03

Disciplined pre-settlement processes matter

Many of the strongest protections are established before funds are advanced.

A disciplined pre-settlement process helps ensure that the commercial rationale, authority, identity checks, and supporting materials are clearly recorded and aligned with the transaction as a whole. These steps are not about adding friction; they are about creating a reliable record that supports lenders, borrowers, and advisers if circumstances change.

04

Independent legal advice should be meaningful

Independent legal advice is most effective when it is treated as a genuine safeguard rather than a procedural requirement.

When advisers are provided with sufficient time, information, and context, the advice given can meaningfully support informed decision-making. Approached this way, independent legal advice protects all parties and strengthens the integrity of the transaction.

05

Our role: supporting durable lending structures

Finance Law works with lenders and market participants to design loan structures that are commercially sound, consistent with established practice, and capable of withstanding scrutiny over time.

Our approach is grounded in experience across origination, structuring, and process. We focus on clarity, alignment, and discipline — helping ensure that each transaction is supported by well-considered documentation and a structure that reflects its true commercial intent.