Can franchise businesses get UK business loans?

Short answer: Yes — franchise businesses in the UK can access a wide range of business loans and finance products. Lenders treat franchises differently depending on trading history, franchisor strength and the purpose of the funding. Typical options include unsecured and secured business loans, asset finance, commercial mortgages and specialist franchise packages. Get a quick, no‑obligation eligibility check to see what your franchise could borrow: Get Quote Now — Free Eligibility Check.

Quick summary — at a glance

• Yes, franchise businesses can get business loans in the UK — subject to lender criteria.
• Typical loan sizes we organise start from around £10,000 and can go up to substantial sums for property or multi‑unit expansion.
• Common funding routes: business loans (secured/unsecured), asset finance, commercial mortgages, invoice finance and specialist franchise packages.
• Speed: initial quotes often within hours from brokers; full offers take days–weeks depending on checks and security required.

Why franchises are considered differently by lenders

Franchises combine elements of an independent business and a larger network. Lenders will look at both the individual franchisee and the franchisor because the brand, ongoing support and contractual terms affect the risk profile.

• Franchisor strength: well-known, proven franchisors make lending easier because they reduce business risk.
• Royalties and fees: ongoing payments to the franchisor reduce available cashflow — lenders model these when assessing affordability.
• Single site vs multi‑site: multi‑site owners with a track record are often more attractive to lenders than single new sites.
• Franchise agreement: termination clauses, territory protections and franchisor support are scrutinised.

Key lender concerns

Lenders commonly assess: profitability and trading history, quality of management, the franchise agreement, security available, director credit histories and the intended use of funds.

Funding options for franchise businesses

Franchises can access most mainstream business finance products. Which is best depends on your needs (buying a franchise, equipment, premises, working capital or expansion).

Business loans (unsecured & secured)

Flexible for working capital, fit‑outs or initial costs. Unsecured loans suit established franchises with good financials; secured loans (against property or assets) can offer lower rates and larger sums.

Asset finance

Ideal for equipment-heavy franchises (kitchens, vehicles, machinery). Finance can cover new or used assets and can be structured as hire purchase or leasing, often covering most of the asset cost.

Commercial mortgages / property finance

For buying or refinancing premises. LTVs depend on lender and property type; lenders expect 60–75% LTV in many cases and strong tenant/trading covenants for owner‑occupied or investment purchases.

Working capital & invoice finance

Invoice finance frees cash tied up in unpaid invoices — useful for franchises supplying to business customers or for seasonal cashflow smoothing.

Franchise-specific finance

Some lenders specialise in franchise lending and understand royalty structures and franchisor support; franchisors sometimes introduce preferred lenders or offer loan guarantees or rebates.

Short-term bridging finance

Bridging loans can temporarily fund property purchases or urgent fit-outs ahead of longer-term finance.

Want to see what products suit your situation? Free Eligibility Check (2 minutes, no obligation).

What lenders look for in franchise applications

• Trading history: many lenders prefer at least 12 months to 3 years; multi‑site owners with a longer track record have more options.
• Financial evidence: management accounts, accounts, VAT returns and bank statements.
• Franchise agreement: clarity on fees, territory and franchisor support.
• Business plan & cashflow forecast: shows lenders how you’ll service debt and grow.
• Security & guarantees: assets you can offer as security and willingness to provide director guarantees.
• Sector experience: lenders favour experienced operators in the specific franchise sector.

Quick tips to improve eligibility

• Gather accounts and bank statements before you apply.
• Reduce discretionary director drawings to show stronger cashflow.
• Ask your franchisor for a support or performance letter if available.
• Consider asset finance if you have specific equipment to fund — this often has lower approval hurdles.

Common franchise scenarios & likely lender responses

1) New franchise start‑up (pre‑opening to <12 months)

Challenge: limited trading history. Lenders may still consider start‑ups where the franchisor has a proven roll‑out and strong trading data. Typical routes: franchisor-backed finance, asset finance for equipment, or a smaller unsecured loan with a higher rate. Expect higher due diligence and possible personal guarantees.

2) Established single‑site franchise (3–5 years trading)

Often able to access unsecured or secured business loans, asset finance and overdrafts. Good trading history and clear accounts increase options and reduce rates. Commercial mortgage possible if buying premises.

3) Multi‑site owner expanding

Strongest position — multi‑site operators often secure larger lines of credit, portfolio lending or growth facilities. Lenders value diversification of revenue and experienced management; options include development facilities and refurbishment finance.

How much can franchises borrow?

Indicative ranges (guidance only):

• Unsecured business loans: from around £10,000 up to £250,000+ depending on lender and trading history.
• Asset finance: typically up to 100% of asset cost (subject to terms).
• Commercial mortgages: usually 60–75% LTV (varies by lender and property).
• Invoice finance: a percentage of invoice value, commonly 70–90% advanced.

Timelines: initial broker quotes in hours to days; full underwriting and legal completion can take 2–8 weeks depending on complexity.

How UK Business Loans can help franchise owners

We’re a specialist introducer that connects franchise businesses with lenders and brokers who understand franchise models. Our role is to match your enquiry with partners most likely to offer suitable terms — saving you time and increasing your chances of a good outcome.

1. Complete a short enquiry (takes ~2 minutes).
2. We match you to lenders and brokers with franchise experience.
3. You receive rapid contact and can compare offers — there’s no obligation to proceed.

Ready to compare options? Get Quote Now — Free Eligibility Check

What you’ll need to apply

Prepare these documents to speed approval:

• Company registration number and address
• Last 12–24 months’ accounts (or management accounts)
• Recent business bank statements
• Franchise agreement and evidence of franchisor support
• Proof of identity and address for directors
• Cashflow forecast and business plan (for start‑ups/expansions)

When you’re ready, use our short form to submit details: Start Your Enquiry.

Fees, compliance & privacy

Important: UK Business Loans is an introducer — we do not lend money or provide regulated financial advice. Our service is free to use for businesses. Submitting an enquiry does not affect your credit score. Lenders and brokers set their own fees and terms; any fees will be disclosed by them before you commit.

We’ll share your details only with selected lenders or brokers that can help with your request. See our Privacy Policy for full details.

Frequently asked questions

Can a newly opened franchise get a business loan?

Possibly. Specialist lenders and franchisor‑backed schemes can support new outlets, although they often require a strong franchisor track record, a realistic business plan and potentially a higher deposit or personal guarantee.

Will my franchise agreement affect borrowing?

Yes. Lenders examine royalties, territory terms and termination rights. A clear agreement and strong franchisor support improve lender confidence.

Do franchises usually need personal guarantees?

Many business loans and commercial mortgages require director guarantees, especially for smaller or higher-risk applicants. Some asset finance deals may limit guarantees depending on asset value and lender policy.

Can I borrow to buy a franchise property?

Yes — commercial mortgages and bridging finance are common for property purchases. Lenders assess property type, location and the borrower’s financials.

Will applying with UK Business Loans affect my credit score?

No — submitting an enquiry via our platform does not trigger a credit search. Lenders may perform checks only with your consent when you move to an application stage.

How quickly will lenders contact me?

Matched lenders or brokers often contact applicants within hours during business hours; full underwriting and offers can take days to weeks.

For broader options and information on small business financing, see our guide to small business loans, which explains products and suitability for different business types.

Next steps — get a free eligibility check

If you’re running or buying a franchise and want to explore funding, the fastest way to get tailored options is to complete our short enquiry. We’ll match you to lenders and brokers who understand franchises so you can compare offers quickly and with no obligation.

Get Quote Now — Free Eligibility Check

Expect calls or emails from matched partners — often within hours. You decide which offer (if any) to accept.

1. Can franchise businesses get UK business loans?
Yes — franchise businesses in the UK can access a wide range of business loans and franchise finance options depending on franchisor strength, trading history and lender criteria.

2. How much can a franchise borrow with a business loan in the UK?
Typical amounts range from around £10,000 for unsecured loans up to £250,000+ for business loans, with commercial mortgages and development facilities available for much larger sums.

3. What types of finance are available for franchise businesses (e.g. asset finance, commercial mortgages)?
Franchises can access business loans (secured/unsecured), asset finance, commercial mortgages, invoice finance, bridging loans and specialist franchise funding.

4. Will submitting a free eligibility check with UK Business Loans affect my credit score?
No — completing the enquiry form is not an application and does not impact your credit score; lenders only run credit checks if you progress an application.

5. How quickly will lenders or brokers contact me after I complete the eligibility check?
Matched lenders or brokers often contact applicants within hours during business hours, while full underwriting and offers typically take days to a few weeks.

6. Do franchise loans usually require personal guarantees or director guarantees?
Many lenders ask for director or personal guarantees—particularly for smaller or higher‑risk deals—though some asset finance and specialist products may reduce guarantee requirements.

7. What documents will lenders expect when applying for franchise finance?
Prepare company registration details, 12–24 months’ accounts or management accounts, recent bank statements, the franchise agreement, ID for directors and a cashflow forecast or business plan.

8. Can newly opened or start‑up franchises get franchise finance?
Possibly — specialist franchise lenders or franchisor‑backed schemes may fund start‑ups if the franchisor has a strong track record, you present a solid plan and accept higher deposits or guarantees.

9. What do lenders look for when assessing franchise finance applications?
Lenders assess trading history, franchisor strength and the franchise agreement (royalties, territory, termination), management experience, cashflow/profitability, security and director credit history.

10. Does UK Business Loans charge fees or provide regulated financial advice?
No — UK Business Loans is a free introducer that connects you to FCA‑regulated brokers and lenders but does not lend money or provide regulated financial advice, and any lender fees will be disclosed by them.