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Compare business loans

We'll compare hundreds of business loan providers, to find the right finance for your business

Minimum turnover is £100,000 with 1 year trading

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This service is provided by our trusted partner Think Business Loans. They are a credit broker and not a lender. Rated 5* 'Excellent' on Trustpilot.

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What is a business loan?

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When you're setting up or growing a business, you may need loan finance to help with the costs. 

A business loan is different from a personal loan in that you will need to provide information about your business, its turnover and its profit.

Business loans can be short term or long term, but all involve borrowing a lump sum and then paying a set amount of interest each month until the debt is cleared.

Different loans are available for different circumstances, so it helps to have a clear idea of exactly what you need the money for before you compare business finance loans.

Types of business loans


Asset finance – This type of finance allows you to spread the cost of essential assets you need to operate, such as equipment machinery and vehicles.

Working capital loans - This is a type of short-term loan used to help with cashflow and other day-to-day running costs.

Bridging loans - Most often used in property purchases and development projects, this short-term funding option can cover the costs while you wait for funds to clear from the sale of property or an asset.

Commercial mortgages – This is a long-term loan used to help fund the purchase of a business property. 

Peer-to-peer loans – Also known as P2P loans, this is when your business borrows money from individuals or other businesses instead of a bank.

Invoice finance - Often used to help with cashflow, this is when you use your unpaid invoices as security for funding. A lender may buy your invoices for a percentage of their total value or it can work more like an overdraft. 

Business start-up loans

Every business needs money to get off the ground, but it can be difficult to find funding when you’re a start-up, as lenders have no way of knowing how your business handles credit or even if it’s viable.

In this instance, it’s worth looking into the government’s Start Up Loan scheme, which provides access to unsecured personal loans of between £500 and £25,000. The scheme also offers free support and guidance to help write your business plan. If your application is successful, you’ll also be eligible for up to 12 months of free mentoring.

How to choose a business loan?

Choosing a business loan is an important decision that requires careful consideration of various factors. Here are some steps to help you choose the right business loan:

Identify your business' needs: Determine why you need the loan and how much capital is required. Consider the purpose of the loan, whether it's for working capital, expansion, equipment purchase, or other business needs.
Asses your business' creditworthiness: Check your credit score and credit history. Lenders often use this information to assess your creditworthiness. A higher credit score can result in better loan terms and interest rates.
Research loan types: Understand the different types of business loans available as described above. Each type of loan has its own terms, repayment schedules, and interest rates and is best for specific needs and circumstances.
Compare interest rates and fees: Shop around and compare interest rates from different lenders. Consider both fixed and variable interest rates and be aware of any additional fees, such as origination fees or prepayment penalties.
Evaluate repayment terms: Understand the repayment terms, including the loan term, frequency of payments, and whether the payments are fixed or variable. Assess whether the repayment schedule aligns with your business's cash flow.
Consider loan amount and eligibility: Ensure the loan amount offered meets your business's needs. Check the eligibility criteria of different lenders to make sure you qualify for the loan.

What the risks of taking out a business loan?

While taking out a business loan can provide essential capital for growth or operations, it also involves certain risks that business owners should be aware of. Here are some common risks associated with business loans:

  • Debt burden: One of the primary risks is the potential for a significant debt burden. Monthly repayments can strain cash flow, especially if the business faces unexpected challenges or a downturn in revenue.

  • Interest rates: Interest rates can fluctuate, especially if you have a variable-rate loan. This could lead to higher monthly payments, impacting your profitability.

  • Default and collateral loss: If the business is unable to make loan payments and defaults, it may result in the loss of collateral. This could include business assets, personal assets, or both, depending on the type of loan.

  • Impact on credit score: Defaulting on a business loan can negatively affect your credit score, making it more challenging to secure financing in the future. A lower credit score may also result in higher interest rates on future loans.

  • Market risks: Economic downturns or changes in the market conditions can impact your business's ability to generate revenue. This, in turn, may affect your ability to repay the loan.

What's the cheapest way to borrow money?

If you're looking to borrow money and keep the costs down you could choose a loan with a low interest rates or a credit card with 0% interest.

What happens if I can't repay my loan

If you can't repay your loan, you will get a default notice warning you that if it happens again you could be referred to a collection agency or taken to court.

Loans explained: all you need to know

We have brought together all you could ever need to know about loans in this one-stop-shop guide.

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