Compare UK business loans
A secured or unsecured business loan could help you grow your business, cover running costs or even fund a new company.
- Compare a range of business loans to find the right type of finance
- ThinkBusiness works closely with banks and lenders to get exclusive deals
- Manage your application online or on your smartphone
Find and compare loans from leading providers
We work with and compare loans from high street banks, challenger banks and alternative lenders.
How to compare UK business loans
Compare business loans from a range of UK lenders in three simple steps
1
Give us a few details
Tell us a bit about your business and why you need funding. We'll use cutting edge iFund technology to find the most suitable loans and lenders.
2
We'll run a comparison
We'll compare what's on offer from our panel of lenders and our account manager will talk you through the options to find a loan that works best.
3
You get your funds
Once you've decided on a loan, we'll take care of the rest to ensure that you get your funds as soon as possible. Your account manager will be on hand to help.
What is a business loan?
A business loan is a form of credit designed for commercial organisations.
Whether you’re looking to overcome a small financial hiccup or need to pay for huge changes, taking out a business loan could provide the money you need. Business loans are suitable for both existing businesses and new start-ups.
Business loans work in a similar way to personal loans for individuals. Your company applies to borrow a fixed amount of money, which it must then pay back – with interest – to the lender over a set period.
Business loans come in many shapes and sizes, but the three most common types are secured, unsecured and peer-to-peer lending.
Types of business loan
The sheer number of finance options out there can make it difficult to know where to begin looking. Don’t worry, our partner ThinkBusiness will help you find the right loan for your business.
Unsecured business loans
This type of loan allows your business to borrow money without using any of its assets, including any real estate, as security against the loan.
Secured business loans
These loans require your company to offer security to the lender against the sum being borrowed. Assets might include shares in your company or property it owns.
Peer-to-peer loans
Peer-to-peer (P2P) lending involves borrowing money from an individual through a P2P platform instead of using a bank or other financial organisation.
Asset finance
This type of business finance allows you to borrow against the value of any assets in your business. This includes machinery, IT equipment and even fixtures and fittings. Asset-leasing agreements can also be used to finance new equipment.
Commercial mortgage
These work like residential mortgages but can only be used for commercial property, including any type of building or land you want to buy as an investment. These loans are available for up to 75% of the property's value and the interest paid on the mortgage is tax-deductible.
Bridging loans
Bridging loans are used to cover a shortfall in funding, usually when buying a commercial property or refurbishing an existing one. This type of loan usually has a shorter repayment term and higher interest rates and fees than other types of business loans.
How much can you borrow with a business loan?
You can borrow as little as £500, or as much as £5 million and even beyond that.
Every loan company sets different limits on how much they’re willing to lend. This means your choices for a lender may be limited by the amount you wish to borrow.
How long do I need to repay my business loan?
Business loans can have a short repayment period like a month or a longer term such as 30 years.
When deciding how long you need to repay your loan, you need to be realistic about what you can afford to pay each month.
The longer your loan term, the lower your monthly payments will be, but you'll pay more in interest overall.
Our loan repayment calculator can help you determine how long you need to repay your loan based on how much you can afford to pay every month.
This table shows how the term affects what you pay in interest¹.
| Loan amount | Loan term | Monthly Payment | Total interest |
|---|---|---|---|
| £7,500 | 1 | £637.4 | £148.7 |
| £7,500 | 2 | £324.5 | £287.5 |
| £7,500 | 3 | £220.2 | £428.3 |
| £7,500 | 5 | £136.9 | £714 |
| £7,500 | 7 | £101.3 | £1,006.7 |
| £7,500 | 10 | £74.7 | £1,458 |
How do I know what business loan rate I'll get?
The interest rate you're offered on your business loan is based on a financial assessment of your business by the lender. They'll decide whether to offer you the business loan, and what interest rate to offer you, based on:
Your business's credit rating
The amount and term you're asking for
The age of your business
How profitable your business is
If the lender thinks your business loan is low risk, you'll be offered a lower interest rate. If they think your loan is high risk, you'll be offered a higher interest rate.
Business loans can be an expensive way to borrow money. But you can still get a good deal and save money if you compare business loans. Make sure you only borrow the amount you need and apply for the type of loan that suits your business.”Salman Haqqi, Personal Finance Editor
Other ways for businesses to borrow money
A business loan isn't the only way of securing finance for your business. Other options you could try include:
For quick business finance, a business loan may be the best option, but these six ways to get finance for your business extend your options – although some tend to work better for some businesses than others. You could also consider combining several types of funding. That way, you can get the most value out of each type without relying too heavily on any one source.
Pros and cons of business loans
Before deciding to take out a business loan it's important to weigh up the advantages and disadvantages to make sure it's the right form of credit for your circumstances.
Pros
On the positive side, business loans can:
help provide funding for expansion plans
be used to overcome temporary cashflow problems
offer capital for startup companies
Cons
There are also drawbacks to business loans, including:
Tough eligibility criteria
Repayments that eat into cash flow
High interest rates for businesses with a poor credit history
Business loan FAQs
Compare another type of business loan
Why compare loan deals with money.co.uk?
Comparing business loans could save you money. Our multiple award-winning comparison service makes sure you get the lowest rates possible based on your individual circumstances. Our aim is to provide you with the most up-to-date information, as well as useful tools and calculators so to help you make life's most important decisions and take control of your money.
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Explore business loan guides
How to get a business loan
If you want to take your business to the next level but don’t have the funds to do so, you could consider getting a business loan.
Find out how to get a business loan
How borrowing could boost your business
With the right type of borrowing you could pursue business opportunities that would otherwise pass you by, here's how.
Read more on borrowing for your business
How do business loans work?
If you need funds to help your business grow or expand, a business loan could offer the solution you need. Here is how they work and how to get the right loan for your business.
More on how business loans work¹These figures have been calculated using money.co.uk's loan repayment calculator tool.
Last updated: 16 August 2022