Types of Business Loans and Finance in the UK

Explore the full range of funding options available through UK Business Loans

Running or growing a business often means finding the right financial support at the right time. Whether you’re looking to manage cash flow, purchase equipment, expand into new premises or refinance existing commitments, the key is knowing which type of business loan best suits your goals.

At UK Business Loans, we make that process simpler.
We’re not a lender and we don’t provide financial advice — instead, we act as a finance introducer, connecting you to a nationwide network of reputable UK brokers and lenders who understand your sector, your goals, and your funding needs.

Checking your eligibility is free, takes just a few minutes, and won’t affect your credit score. Our role is to help you compare suitable finance options quickly and clearly, so you can make an informed decision that supports your business objectives.

Below is an overview of the main types of business finance we can help you access — from short-term working capital to large-scale commercial facilities.

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1. Business Loans UK

The most common and flexible form of finance for UK companies, a business loan provides a lump sum that’s repaid over a set period with agreed interest.
Through our network, we can connect you with lenders offering both secured and unsecured business loans, covering funding needs such as:

• Working capital and day-to-day operations
• Recruitment, marketing, or expansion
• Equipment, vehicles, or technology purchases
• Covering unexpected bills or seasonal shortfalls

Loan terms typically range from 6 months to 7 years, depending on lender criteria, credit profile and affordability.

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2. Commercial Finance UK

Commercial finance includes larger, asset-backed or property-linked facilities for more complex funding needs.
Our network of commercial lenders and brokers can help you explore:

• Commercial mortgages for purchasing business premises
• Development finance for property construction or refurbishment
• Bridging loans for short-term capital between projects or transactions
• Owner-occupied and investment property loans

These types of facilities are ideal for businesses planning significant investments or acquisitions, where security and structured repayment terms are key.

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3. Cashflow Loans

A cashflow loan helps businesses bridge temporary gaps between income and expenditure.
It’s particularly useful for companies with seasonal fluctuations or long payment terms.

Lenders typically assess recent bank statements and management accounts to gauge affordability, rather than focusing solely on assets or security.
Common use cases include:

• Paying suppliers or staff during quieter months
• Managing VAT, PAYE or tax liabilities
• Maintaining liquidity while awaiting customer payments

Cashflow loans are often short to medium term, with flexible repayment schedules to ease short-term strain.

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4. Invoice Finance

If your business trades on credit terms, invoice finance can help unlock cash tied up in unpaid invoices.
Rather than waiting 30–90 days for customers to pay, you can receive an advance (usually 70–95%) shortly after issuing the invoice.

There are two main types:

• Invoice Factoring – the finance provider manages collections on your behalf.
• Invoice Discounting – you retain control of collections; the process remains confidential.

This funding is popular with manufacturers, logistics providers, and B2B service businesses who need predictable cash flow without taking on additional debt.

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5. Asset Finance

Asset finance allows you to acquire essential machinery, vehicles, or equipment while preserving working capital.
Instead of paying upfront, you spread the cost over time — often with the asset itself acting as security.

UK Business Loans connects businesses with lenders offering:

• Hire Purchase (HP) – you own the asset at the end of the term.
• Finance Lease – you rent the asset for a fixed period with flexible end-of-term options.
• Operating Lease – suited to short-term or specialist use equipment.
• Sale and Hire Purchase Back – release cash from assets you already own.

This type of finance is common across construction, manufacturing, logistics, printing, and healthcare sectors.

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6. Equipment Finance

Equipment finance is a more specific form of asset finance focused on funding specialist or sector-specific kit.
Our lending partners provide tailored facilities for:

• Medical and dental equipment (X-ray, ultrasound, diagnostic)
• Catering and hospitality fit-outs (kitchens, ovens, refrigeration)
• IT, software, and technology (servers, POS, AV systems)
• Construction and trade equipment (plant, tools, access gear)

Finance terms often align with the useful life of the equipment — helping you modernise operations without disrupting cash flow.

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7. Vehicle Finance

For many UK businesses, vehicles are essential — from company cars and vans to full commercial fleets.
Through UK Business Loans, you can access finance for:

• Hire Purchase or Lease Purchase (own the vehicle at term end)
• Finance Lease or Business Contract Hire (BCH) (rent or lease with options to upgrade)
• Fleet funding for multiple vehicles under one facility
• Refinance options to release equity from owned vehicles

You can also explore EV and low-emission vehicle funding, including finance for electric vans, chargers, and depot infrastructure.

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8. Fit-Out Finance

Fit-out and refurbishment finance helps you upgrade or expand your business premises without large upfront costs.
This type of funding is ideal for:

• Retail and hospitality refurbishments
• Office, clinic, or salon fit-outs
• Equipment, fixtures, and interior design costs
• Energy-efficient or accessibility upgrades

Some lenders offer staged drawdowns, meaning funds are released in phases to match project milestones.

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9. Refinance Options

Refinancing can help you consolidate multiple loans or restructure existing facilities to reduce monthly outgoings and simplify management.
Common forms include:

• Business debt consolidation into one facility
• Asset refinance to release cash from owned machinery or vehicles
• Invoice finance replacement for better rates or service
• Commercial mortgage refinance to lower repayments or release equity

Refinancing can also improve cash flow, reduce administrative burden, and help reposition your business for future growth.

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10. Sustainability Loans UK

As UK businesses adapt to greener operations, sustainability loans and green asset finance have become increasingly popular.
We can introduce you to lenders offering funding for:

• Solar PV systems, battery storage and inverters
• EV chargers, electric vans and fleet upgrades
• Energy-efficient lighting, HVAC and heat pumps
• Building fabric upgrades and insulation improvements

In some cases, repayment structures can align with energy-cost savings, helping your business invest in sustainability without disrupting cash flow.

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11. Business Expansion Loans

Growth often requires investment — and business expansion loans provide the flexibility to scale without diluting ownership or using personal savings.
Funds can be used for:

• Hiring staff or expanding marketing activity
• Opening new locations or franchises
• Product launches and rebrands
• Upgrading technology or systems

These loans can be unsecured or secured depending on your turnover, trading history, and the size of the facility required.

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12. Short-Term Business Loans

When speed and flexibility matter most, short-term business loans can bridge temporary funding gaps.
They’re designed for fast approval and typically range from 3 to 18 months.
Popular use cases include:

• Covering unexpected costs or delays
• Buying stock or materials at short notice
• Managing tax or VAT obligations
• Funding urgent repair or compliance work

Short-term loans usually have higher interest rates than long-term facilities but can be a valuable tactical tool for maintaining operations.

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Which Type of Finance Is Right for You?

The best type of business finance depends on your company’s stage, cash flow, and objectives.
Here’s a quick summary:

Finance Type	Typical Use	Repayment Term	Secured / Unsecured
Business Loan	General working capital, expansion	6–84 months	Both
Commercial Finance	Property or large projects	1–25 years	Secured
Cashflow Loan	Seasonal gaps, short-term liquidity	3–24 months	Unsecured
Invoice Finance	Release cash from invoices	Rolling	Secured (debtors)
Asset / Equipment Finance	Machinery, tools, vehicles	1–7 years	Secured (asset)
Vehicle Finance	Cars, vans, fleets	1–7 years	Secured
Fit-Out Finance	Refurbishments, fit-outs	1–5 years	Both
Refinance	Consolidate or restructure debt	Varies	Both
Sustainability Loans	Green upgrades, renewables	1–10 years	Both
Expansion Loans	Growth and scaling	6–60 months	Both
Short-Term Loans	Quick access to capital	3–18 months	Unsecured

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Why Choose UK Business Loans?

• Free, no-obligation enquiry — check eligibility without commitment.
• No impact on your credit score — soft search only until you proceed.
• Nationwide lender network — access to specialist finance providers.
• Fast responses — many partners can provide indicative terms within 24–48 hours.
• Industry understanding — from start-ups to established SMEs, we match you with lenders who get your business.

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How It Works

1. Submit a quick enquiry – share a few details about your business and funding goals.
2. We match you with trusted UK brokers and lenders – based on industry, turnover, and loan purpose.
3. Receive your quick quote or Decision in Principle – usually within one working day.
4. Discuss options directly with your chosen lender – no pressure, no obligation.

It’s that simple — and your data is kept secure and confidential throughout.

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Start Your Enquiry Today

Whether you’re a start-up seeking your first loan or an established company looking to fund your next phase of growth, UK Business Loans helps you find the right finance — fast.

👉 Start your free eligibility check now at UKBusinessLoans.co — it takes just two minutes and won’t affect your credit score.

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Disclaimer:
UK Business Loans is a finance introducer and not a lender. We do not provide financial advice. All finance is subject to status, affordability, and lender approval. Enquiries are free and carry no obligation. Late or missed repayments can cause serious financial problems — for free help and guidance, visit MoneyHelper.org.uk.