Small Business Loans

Small Business Loans

Get a small business loan with ABC Finance today. We can help you get funds in as little as 24 hours.

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Gary Hemming

Author: Gary Hemming CeMAP CeFA CeRGI CSP

20+ years experience in business loans

Small business loans are one of the main finance options used by startups and small businesses. This type of loan is quite straightforward with funding provided by a lender that is paid back over an agreed period with interest.

There are many types of small business loan and so it is important to understand what is available and what suits your circumstances best.

At ABC Finance, we’ve been helping UK SMEs to secure the finance they need to take their business to the next level since the year 2000. Get in touch now to find out how we could help you.

Can my small business get a loan?

Yes, in most cases it is possible to arrange business loans as there are a wide range of lenders and types of finance available.

If, however, you have significant issues relating to your business, such as a very poor credit rating, then there may be other more suitable types of finance and your broker will be able to advise what is the most appropriate product.

If your business has been trading for more than 6 months, and is trading successfully then there is a high chance that we can offer your business a loan.

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How do I apply for a business loan for my small business?

There are several steps to take before you apply for a loan. Firstly, your business will need to be registered in the United Kingdom (for limited company loans) and you will need to provide paperwork such as bank statements and financial accounts to demonstrate your trading history.

Once you have decided how much you need and what the funding is for then you will need to compare financial products and lenders.

It is advisable to use a specialist business loan broker, such as ourselves to ensure you understand the types of financial products available and what will be most suitable for your needs.

We can advise you on the options available, find the best deal for you and handle the whole application process for you.

How do small business loans work and what types of loans are available?

Small business loans provide capital to companies, they can be for specific expansion plans, buying new equipment or to manage cash flow.

There are a number of types of loans available to small businesses and so it is worth understanding the differences between them.

Some financial products will be better suited to your circumstances than others. For example, do you need a short term or a longer loan, do you have a good credit score or could it be improved?

Examples of different types of funding available to companies in the UK include:

  • Unsecured business loansunsecured business loans allow you to borrow funds without having to provide collateral to the lender. They’re a fast way to borrow funds, with some lenders able to offer funds in as little as 24 hours. For this reason, they’re often called fast business loans.
  • Secured business loanssecured business loans work much like unsecured lending, but the lender takes security over your property. They take a little longer to arrange but are an excellent option for businesses in need of working capital finance.
  • Invoice financeinvoice finance allows you to release funds from the invoices that you have raised, but have not yet been paid. It is ideal for businesses that operate on delayed payment terms. As a financial product, it can be broken down into invoice factoring (also known as debt factoring) and invoice discounting. The key differences come down to who is responsible for credit control. Confidential invoice discounting allows you to borrow without alerting your customers.
  • Asset financeasset finance and inventory financing, also known as equipment financing provides the funding needed to purchase new equipment for your business.
  • Revolving credit – a business revolving credit facility is a flexible way to borrow money for companies in need of money quickly. They allow you to borrow and repay funds as needed, acting as an ongoing business cash flow loan.
  • Cash advance – A merchant cash advance, also known as a business cash advance allows you to borrow money against your future card receipts. They tend to work well for businesses that take a large proportion of their turnover through their card terminal, such as pubs, restaurants and retailers.
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How much can I borrow?

We can offer loans from £5,000 with no maximum loan size, although unsecured lending will be capped at £500,000.

The amount you can borrow varies from as little as a thousand pounds to a million pounds in some instances.

Finance is very much dependent on your circumstances, credit rating and company financial performance and the level of repayments that you can comfortably afford.

How long does it take to receive the funds?

When funds are needed quickly, we can complete your application and release funds to you in as little as 24 hours.

Extremely quick completions such as this may reduce your choice of lenders and mean that you end up paying a higher interest rate. If you’re looking for lower rates, expect to receive funds in 5-7 days.

A secured loan will take longer than an unsecured loan as the process is a little more complex with a valuation being required on your property and some legal work to register the legal charge.

For an unsecured loan you could receive funds as quickly as 24 hours, or for a longer term secured loan the entire process will take around two weeks.

A credit check will also be required, however, these can often be undertaken online with a credit reference agency instantly.

How can a small business loan benefit my business?

A small business loan can be very helpful and be used for a number of purposes in addition to providing a capital injection.

This type of finance is often used for the following:

  • Finance for business growth and expansion
  • Recruiting new staff
  • Funding marketing and advertising expenses
  • Purchasing inventory or equipment
  • Expanding premises or taking on a second site
  • Payment of corporation tax or a VAT bill
  • Help with cash flow – known as business cash flow loans
  • Renovation or refurbishment of your business premises
  • Payment of corporation tax or VAT – known as a corporation tax loan

Frequently Asked Questions

Yes, it is likely there will be options available. Whilst having a good credit history is helpful, small business financing is based on many factors and so bad credit is not necessarily a barrier to getting a loan.

We offer a range of specialist bad credit business loans.

When you apply for a small business loan, you will be asked to provide the following:

  • 2 years accounts
  • 6 months business bank statements
  • Management accounts – in some, but not all cases

No, there are a wide range of small business loans available, both secured and unsecured, and not all forms of finance require collateral.

You can choose to provide collateral and this may give you more loan options at a lower rate, however, ABC works with a wide panel of lenders to find solutions to fit your circumstances. In fact, most borrowers choose an unsecured business loan due to the simplicity of the application process.

Terms can vary from a few weeks to a maximum of 7 years depending on the purpose of your loan.

ABC finance works with multiple funders giving more flexibility and a range of options. We have over twenty years of experience matching businesses with finance providers.

Want help finding your perfect solution?

Request a callback from our team of experts at a time convenient for you.