If you're reading this at 11pm with a letter from IRD or a statutory demand on the desk, take a breath. A business in financial trouble is not the same as a business that's finished. Many good Kiwi businesses hit a wall because of one bad contract, a slow season, a customer who didn't pay or tax that got away from them. What they need is time and cash, not a liquidator.
fundU is a direct New Zealand lender. Our business rescue finance is a property-secured loan of $20,000 to $1m that can clear the debts causing the crisis, so you can stay in control and keep trading.
What is business rescue finance?
Business rescue finance is funding used to pull a viable business back from the brink. Instead of winding the company up, you borrow against property equity to pay out the pressure points, such as IRD arrears, a statutory demand, expensive short-term loans or overdue suppliers.
The idea is simple. If the business can trade profitably once those debts are dealt with, paying them out with a single, longer loan gives it the breathing room to recover. The loan is then repaid from a refinance, a property sale, business cash flow or another clear exit.
Why are so many New Zealand businesses under pressure?
Because the last couple of years have been genuinely tough, especially in construction, hospitality and retail. You are not the only one feeling it.
The Centrix Credit Indicator report for July 2026 recorded 3,035 company liquidations in the year to May 2026, up 14% on the year before. Construction accounted for 755 of them, hospitality liquidations climbed 51% to 421, and retail was up about 35%. Inland Revenue has also stepped up its focus on overdue GST and PAYE, contacting businesses and, where needed, taking enforcement action.
Behind those numbers are plenty of owners who had real businesses worth saving but ran out of runway. The earlier you act, the more choices you have.
Is liquidation really your only option?
Usually not, and it's worth understanding what liquidation actually involves before you head down that road. Liquidation is designed to wind up a company, not rescue it.
According to the Companies Register and the Insolvency and Trustee Service, once a liquidator is appointed they take control of the company's assets and affairs and the directors' powers largely stop. The liquidator's job is to realise the assets and distribute the proceeds to creditors, and their fees and costs come out of those assets first.
In practice that can mean:
- you lose control over what happens to the business you built
- assets are often sold quickly, which rarely gets the best price
- goodwill, customer relationships and contracts can disappear
- your team loses their jobs
- personal guarantees you've signed can still be called on
Liquidators do an important job, and for some businesses it is the right outcome. But if your business is viable and you or your family own property with equity, it's worth exploring whether you can be funded out of trouble first.
Good to know: Receivership and voluntary administration are also formal processes that put someone else in charge. Before agreeing to any of them, find out whether a property-secured loan could clear the debts and let you keep control.
How does rescue funding compare with the formal options?
Each option solves a different problem. This table sets out the practical differences in plain terms.
| Liquidation | Receivership | Voluntary administration | Rescue funding from fundU | |
|---|---|---|---|---|
| Who's in control | A liquidator | A receiver, usually appointed by a secured lender | An administrator | You, as owner and director |
| Main purpose | Wind up the company | Recover a secured lender's debt | Look for a deal with creditors | Pay debts so the business keeps trading |
| Business keeps trading? | Usually stops | Sometimes, while assets are sold | Sometimes | Yes, that's the aim |
| Professional costs | Paid from company assets | Paid from company assets | Paid from company assets | Loan priced on your circumstances |
| Staff and goodwill | Often lost | Often at risk | At risk | Protected where the business is viable |
What can business rescue finance pay for?
Rescue funding is used to remove whatever is threatening the business right now. The most common uses are:
- IRD arrears. Paying overdue GST, PAYE, provisional or terminal tax directly to Inland Revenue, stopping penalties and interest from growing. See our IRD tax debt loans page.
- A statutory demand. Paying or settling the debt before the 15 working day deadline runs out.
- Expensive short-term debt. Refinancing daily or weekly repayment loans and merchant cash advances into one loan. Our business debt consolidation page explains how.
- Overdue creditors. Catching up key suppliers so they keep supplying.
- Wages and essential costs. Covering payroll and rent through the short gap while the plan takes effect.
- A lender demanding repayment. Refinancing a loan that's been called up or has expired.
What should you do when a statutory demand arrives?
Act straight away. Under section 289 of the Companies Act 1993, a company has 15 working days to pay the debt, reach a settlement or apply to the court to set the demand aside. If it does nothing, the creditor can use the unpaid demand as grounds to apply to put the company into liquidation.
- Note the date. Work out exactly when the 15 working days end. Weekends and public holidays don't count.
- Check the debt. Is the amount right? If it's genuinely disputed, talk to your lawyer promptly about the set-aside process.
- Talk to the creditor. Many creditors would rather be paid than liquidate you. A clear message that funding is being arranged can help.
- Identify property equity. Your home, a rental, commercial premises or a family trust property may be able to secure a loan.
- Contact a direct lender early. The sooner we know, the more time there is for valuation and legal work before the deadline.
Our guide on what to do about a statutory demand covers this step by step.
When isn't rescue funding the right answer?
We'll always be straight with you. A loan fixes a cash problem, not a business model problem.
Rescue finance tends to work when the business is profitable or close to it once the immediate debts are cleared, when there's genuine equity in a property, and when there's a believable way to repay the loan. If the business loses money every month no matter what, borrowing against the family home to keep it going may simply move the loss onto the house. In that situation our team will say so honestly and talk through other paths, including selling the business while it still has value. Our guide to alternatives to liquidation sets out the wider range of options.
Example scenario
A Canterbury civil contractor with twelve staff has about $160,000 in overdue GST and PAYE, two daily repayment loans totalling $70,000, and a supplier who has just served a statutory demand for $45,000. The bank won't extend the overdraft. The directors are weighing up liquidation, but the order book for the next six months is solid.
The directors own their home, worth about $1.3m, with $520,000 owing to the bank. fundU lends $300,000 by second mortgage, keeping the bank home loan in place. At settlement the supplier, IRD and both short-term lenders are paid directly, with the rest held as a working capital buffer. Interest is capitalised for the term, so there are no scheduled monthly repayments while the business rebuilds. The plan is to repay through a bank refinance once two clean quarters are on the books, or from the sale of a surplus excavator if needed.
What you'll need
When things are urgent, keep it simple. To get started, have these ready:
- Details of the property offered as security, who owns it and what's owing on it
- A list of the debts that need clearing, with amounts and any deadlines
- A copy of any statutory demand, IRD letter or lender notice
- Recent business bank statements
- Your IRD position from myIR, if tax is involved
- Company details or your NZBN
- A short note on why the business got into difficulty and what changes now
How do you get your business funded out of trouble?
Pick up the phone or send an enquiry today rather than tomorrow. Every day matters when a deadline is running, and early action keeps the most options open. Good businesses deserve a fair go, and a short conversation will tell you whether a property-secured loan can give yours one.
Start your enquiry in a couple of minutes, with no effect on your credit score, and a fundU lending specialist will call you back. For anything urgent, call 09 875 4577.
Frequently asked questions
Can fundU lend to a business that has received a statutory demand?
Yes, we consider it case by case. A statutory demand gives a company 15 working days to pay, settle or apply to set it aside, so time matters. If there's property equity available and a realistic plan for the business, a loan can pay the demand and remove the immediate threat of a liquidation application. Contact us as early in those 15 days as you can.
Is it too late to get rescue funding if IRD is chasing my business?
Often it isn't. IRD debt is one of the most common reasons business owners come to us. We can pay overdue GST, PAYE and provisional tax directly, stopping further penalties and interest and taking IRD out of the picture. What matters is having property to secure the loan and a sensible way to repay it.
What property can be used as security for a rescue loan?
We lend against New Zealand residential, commercial and industrial property, and some land or lifestyle property case by case. The property can be owned by you, your company, your family trust or a supporting party such as a family member acting as guarantor. We can lend by first or second mortgage, so an existing bank mortgage can often stay in place.
Why not just put the company into liquidation and start again?
Sometimes that is the right call, but it shouldn't be the first step. Once a liquidator is appointed, directors lose control of the company, the liquidator's costs are paid from what's left, and goodwill, contracts and staff are often lost. If the business is fundamentally sound, funding it out of trouble can protect far more value for you and your creditors.
Do I need financial statements when my business is in trouble?
No financial statements or tax returns are needed for the initial assessment. When a business is under pressure, the accounts are often behind anyway. We focus on the property, the debts that need clearing and the plan from here. Bank statements, IRD statements from myIR and creditor letters are usually enough to get started.
How fast can fundU provide rescue funding?
Because we make our own decisions, we can move quickly. Funding can happen in as little as 24 hours once approved in some cases, depending on the valuation, legal work and how fast documents come in. We never promise a settlement date, so the earlier you talk to us, the more room there is to act before a deadline.
A practical next step
Ready to see what's possible?
Tell us what the business needs, when you need it and what property is available. A fundU lending specialist will call you back to talk it through — enquiring is free and won't affect your credit score.