Short-term business loans

Most businesses will need to borrow money at some stage either to help with cashflow, or to pay for expansion costs, and a short-term business loan can provide the ideal solution. Although recent years have seen a reduction in the number of business loans on offer, there are still plenty of options available to explore.

MoneySuperMarket doesn't offer a comparison service for this type of product, but we have compiled a list of lenders below who can help.

Short-term business loans

    • Provider/Product name Business Loan

      ezbob

      Business Loan

    • Description

      UK's #1 provider of unsecured business loans

      A quick and simple 10 minute online application makes £50,000 available to you at the click of a button

      Credit decisions are based on business performance not just your personal credit score

      You choose the length of the loan, up to one year. Early repayment is acceptable with no penalties and no hidden fees

      Requirements: One year trading history + £100,000 in annual sales

    • Go to site

    EU Funded

    Chosen by the European Investment Fund (EIF) to be a certified EU financial intermediary under the EPMF Guarantee scheme

    Backed by the UK Governments Angel Co-Fund and appointed Financial Intermediary by the European Union and European Investment Fund. 
     

    • Provider/Product name Business Loan

      iwoca

      Business Loan

    • Description

      Award-winning business loans to invest in new opportunities or bridge cash flow gaps.

      > Borrow £1,000 - £50,000 with flexible repayments
      > Rates from 2% - 6% per month (no other fees)
      > Free early repayments

      Sign up in minutes with none of the paperwork associated with traditional providers. Their expert account managers will immediately look at your application so they can get you funded within hours.

      Get approved today for free.

    • Go to site

    Top-rated lender on independent review site Trustpilot.

    • Provider/Product name Business Loan

      Ashley Business Cash

      Business Loan

    • Description

      For 21 years Ashley have provided flexible funding exclusively to small businesses. Ashley’s Business loan is quick, simple, and can be used for any business purpose whether to bridge a gap in cash flow, make refurbishments or pay a VAT bill - it's up to you.

      • Borrow up to £100k and repay over a period of 6-18 months to suit you
      • Only three months trading history required - decisions based on previous trading not necessarily on perfect credit score
      • Fixed transparent fees at all times and no penalty for repaying early
      • ‘Top up’ funding available throughout the facility

      Just Ask Ashley!

    • Go to site

    Trading at least three months+. Must own/lease business premises. Guarantor may be required.

    • Provider/Product name Business Loan

      Everline

      Business Loan

    • Description

      Everline provides fast, flexible and convenient credit to entrepreneurs looking to expand their business, manage working capital, or fill a cash gap.

      • Borrow up to £50k for up to 52 weeks
      • If approved, funds are sent within five minutes
      • All costs are clearly displayed and you don’t pay a penny more

      Repay early to save on interest, no early repayment fees

    • Go to site

    Over 18 and UK resident. Trading for minimum of 2 years. Loans are subject to approval and terms and conditions apply.

    • Provider/Product name Business Loan

      Funding Circle

      Business Loan

    • Description

      UK’s leading peer-to-peer business lender

      Fast and simple business loans from £5k to £1 million - without the banks.

      Borrow from a community of thousands of people together with the Government-backed British Business Bank, local councils and universities.

      Quick & convenient process:
      > Apply online in as little as 20 minutes
      > You'll hear from Funding Circle within two working days of completing your application 
      > Loan terms from six months to five years. No early repayment charge.

      Flexible loans: borrow for working capital, expansion, property, asset purchase and one-off business expenses.
      Now open for non-limited companies (sole traders and partnerships) to apply for a loan.

    • Go to site

    Business Funding Scheme

    Local Government is lending millions through Funding Circle to support UK businesses.

    Minimum criteria: Two years+ filed accounts at Companies House or formally prepared accounts for non-limited businesses, minimum turnover of £50k and a good credit score.

    • Provider/Product name Touch Invoice Financing

      Touch Financial Support

      Touch Invoice Financing

    • Description

      Invoice Finance is your small business funding solution advancing up to 95% of the value of your invoices often within 24 hours of their creation.


      Release up to four times as much cash over traditional bank lending.


      The service is free and confidential.


      Create a healthy cashflow and see your business grow.


      Credit collection service available.


      Short-term contracts and trial periods make factoring ideal for first time users.


      Touch Financial Support work with over 20 of the UK’s leading lenders.

    • Go to site

    Invoice Finance is available if you sell your products or services on credit to other businesses. Speak to Touch Financial Support and realise your business’s potential.
     

    • Provider/Product name Asset Finance Loans

      Funding Circle

      Asset Finance Loans

    • Description

      UK’s leading peer-to-peer business lender.

      Asset finance loans for leasing and refinance from £20k to £1 million - without the banks.

      Borrow from a community of thousands of people together with the Government-backed British Bank, local councils and universities.

      Quick & convenient process:
      >Apply online in as little as 20 minutes
      >You'll hear from Funding Circle within two working days of completing your application
      >Long terms from six months to five years. No early repayment charge
      >Wide range of assets including wheeled assets, oiled assets, machinery, buses etc.

    • Go to site

    Business Funding Scheme

    Local Government is lending millions through Funding Circle to support UK businesses.

    Minimum criteria: Two years+ filed accounts with Companies House or formally prepared accounts for non-limited businesses, minimum turnover of £50k and a good credit score.

    • Provider/Product name Business Loan

      Bizniz Cash

      Business Loan

    • Description

      Flexible, short term business funding, £3.5k to £150k.
      Provide your small or medium sized business with the finance you need to improve your cash-flow and help your business grow.
      Do I qualify?
      Answer YES to these 3 questions and Bizniz Cash can almost certainly help.
      > Have you been trading for at least 9 months?
      > Do you take a minimum of £3.5k per month in credit & debit card sales?
      > Have you at least 12 months left on your lease?
      Funds in 7 days for restaurants, bars, garages, retailers, hair & beauty salons and many, many others.
      90% approved. 

    • Go to site

    UK mainland and now Northern Ireland too

    • Provider/Product name Commercial Finance

      Lloyds Bank

      Commercial Finance

    • Description

      You want your company to flourish, and so do Lloyds Bank.
      Lloyds Bank will release up to 90% of an invoice's value, typically within 24 hours.
      It'll save you up to 30, 60 or 90 days of waiting to be paid.

      When you're not constrained by unpaid invoices, you'll have the cash flow and working capital on hand to fund growth.

      95% of Lloyds Bank's clients rated their service highly1. With over 40 years of expertise, Lloyds Bank's invoice finance solutions can run seamlessly and discretely in the background.
      1Independent research, rep. sample June 2013

    • Go to site

    Invoice Finance facilities are provided by Lloyds Bank Commercial Finance Ltd and is not authorised or regulated by the PRA or FCA.

    • Provider/Product name Cash Flow/Invoice Finance

      Aldermore

      Cash Flow/Invoice Finance

    • Description

      Get your cash flowing with Aldermore

      Talk to the bank that champions UK business growth

      Aldermore provides a range of financial products for businesses - supporting over 22,500 businesses and lending £1.8 billion since 2009

      • Get access to working capital fast by releasing up to 90% of the cash tied up in your unpaid invoices
      • Finance that grows with your sales – no more lengthy re-negotiations
      • Fast turnaround on application decisions
      • Deal with local funding specialists with a refreshingly straightforward and simple approach
      • You’ll get a package designed around your business that's easy to understand and clearly priced
      • Get an exceptional customer service that’s been rated 4.7 out of 5 by customers in unedited website reviews
      • Visit the Aldermore website to see how much cash could be released into your business, compared to your current overdraft

    • Go to site

    Ideal for companies that sell on credit to other businesses, including services, recruitment, manufacturing, wholesale, transport and distribution sectors

Short-term Business Loans

A short-term business loan can be invaluable for businesses that need a cash boost if they are expanding, or if they need a bit of extra help to manage their cashflow.

This type of loan usually has a term of six-months, so will need to be repaid quickly. You can usually choose a fixed rate of interest, so you know repayments will be the same every month, or a variable rate, which could mean your repayments change over time.

Advantages of short-term business loans

The main advantage of opting for a short-term business loan is that you know your business will only have to make repayments for a limited period of time. You will also usually pay less interest overall than if you opted to repay what you owe over a much longer term, such as five years.

Read more

Disadvantages of a short-term business loans

Choosing to take out a short-term business loan may mean that you will be able to pay off what you owe quickly, but bear in mind that your repayments will be much higher than if you opted to repay your long over a medium or long-term period. Interest rates can be very high on short-term borrowing, so it’s worth comparing lots of different loans to ensure you find the right deal for your business’s needs.

What else you need to know

Difficult economic conditions in recent years have made it harder for businesses to borrow money. To apply for a business loan, your business may be required to have a minimum monthly turnover, and you may have to show a set number of accounts, usually two or more years.

Remember too that the actual rate of interest you will be charged on a short-term business loan will depend on your business’s individual circumstances, the amount you want to borrow, and over what period you intend to pay off what you owe.

Alternatives to a short-term business loan

If you don’t think your business will be able to pay off any borrowing over a year or less, then you might want to consider a medium or long-term business loan which can be repaid more slowly.

Other options include using a business credit card for any immediate expenses. These can also be a useful way to manage staff spending. You could also speak to the provider of your business bank account about arranging a business overdraft which can provide you access to funds as and when you need them. You can usually arrange an overdraft for a 12 month period, at which point it will have to be renewed.

Businesses can also raise funds though cashflow finance, which allows then to borrow against the value of their unpaid invoices, or they can borrow against their assets such as any equipment or property.

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