Cashflow loans — what rates & fees should I expect?

Short answer: Typical costs for business cashflow lending in the UK depend on the product and your business profile. Expect unsecured short‑term loans from roughly 8%–35% APR, overdrafts 8%–25% APR plus facility fees, invoice finance fees of about 0.5%–3% per invoice (plus interest), and merchant cash advances (MCAs) with effective APRs that can run 40%–200%+. Arrangement, legal and valuation fees commonly add 0.5%–3% or fixed sums. UK Business Loans does not lend — we match companies (loans from around £10,000) to lenders and brokers so you can compare personalised quotes. Start a Free Eligibility Check to get tailored offers: Get Quote Now.

Quick summary — typical rates & fees (at a glance)

• Unsecured short‑term cashflow loans (1–24 months): typical APR 8%–35% depending on credit and term; arrangement fees often 1%–3%.
• Business overdrafts / revolving credit: interest typically 8%–25% APR; some lenders charge annual facility or renewal fees.
• Merchant Cash Advances (MCAs): effective APR often 40%–200%+ — repayment via a sales split or daily/weekly fixed take; usually the most expensive option.
• Invoice finance / factoring: fees 0.5%–3% of invoice value per advance; interest or discounting can equate to 6%–36% APR depending on tenure and structure.
• Secured cashflow loans (asset or property security): interest often 4%–12% APR but depends on security and term.
• Arrangement / origination fees: commonly 0.5%–3% of the facility; other fees include legal, valuation and early repayment charges.

Note: these are indicative ranges only. Exact pricing depends on the lender, sector risk, company performance and requested term. For tailored options, complete a free eligibility check: Free Eligibility Check.

Why rates and fees vary so much

Lenders price risk and complexity. Key factors that drive cost include:

• Trading history and finances: established limited companies with strong turnover and clean banking pay less than newer or loss‑making businesses.
• Security: loans secured by property or assets are usually cheaper than unsecured facilities.
• Repayment method and term: short terms and daily or weekly collections (e.g. MCAs) increase effective APRs.
• Sector risk: sectors with irregular cashflow (hospitality, construction) often face higher costs.
• Loan product: overdrafts, invoice finance, MCAs and term loans all have different cost structures (fees vs interest vs revenue share).

Typical cashflow loan types & indicative costs (detailed)

Short‑term unsecured business loans

Best for predictable short‑term funding needs. Terms 1–24 months. Indicative APR: 8%–35%. Arrangement/origination fees: 1%–3% of the facility. Repayments are usually monthly.

Business overdraft / revolving credit

Flexible borrowing where interest is charged only on the drawn balance. Typical interest 8%–25% APR; some providers also charge an annual facility or renewal fee. Good if you need flexibility rather than a fixed repayment schedule.

Merchant Cash Advance (MCA)

Quick access to cash repaid by taking a percentage of card takings or fixed daily deductions. No traditional APR shown; using factor rates or payment schedules, effective APRs often run 40%–200%+. Consider MCAs only when other options are unavailable — always check sample repayment amounts and run an APR equivalent if possible.

Invoice finance / factoring

Release cash tied up in invoices. Typical advance rates 70%–90% of invoice value. Fees: discount/finance fees commonly 0.5%–3% of invoice value per advance plus interest on outstanding balances — the total cost depends on how long invoices remain outstanding.

Secured cashflow loans (asset or property backed)

Lower rates—often 4%–12% APR—because the lender has collateral. Documentation and valuation times are longer and legal fees typically apply. Suitable if you can provide acceptable security and want lower cost over a longer term.

Short‑term bridging or rapid business loans

High cost for speed: fixed handling fees plus higher interest. Useful for urgent, short-lived gaps but usually more expensive than standard term loans.

Common fees to expect (and how to spot hidden costs)

• Arrangement / origination fee — 0.5%–3% of the facility; sometimes deducted from funds before you receive them.
• Facility / commitment fee — annual fee to keep an overdraft or revolving facility available.
• Documentation / legal fees — typical for secured lending.
• Valuation / appraisal fees — for property or asset security.
• Early repayment charges — some lenders apply a penalty if you repay a fixed-rate facility early.
• Admin / servicing fees — monthly servicing, collection or statement fees.
• Broker fee — occasionally payable by the borrower; UK Business Loans will flag if a broker fee applies.

Always ask for a fully itemised cost schedule and a worked example showing total cost over the loan term (including all fees and repayments).

Real cost examples (illustrative)

Example A — Retailer needs £20,000 for 6 months

• Option 1: unsecured short‑term loan at 18% APR with a 1.5% arrangement fee.
• Arrangement fee = £300 (1.5% of £20,000) deducted up front → funds received = £19,700.
• Approx. interest over 6 months (simple estimate) ≈ £1,800. Total cost ≈ £2,100 → effective cost ≈ 10.5% of initial funds over half a year (this is illustrative — lenders show APR which annualises cost).

Example B — Café takes a £30,000 MCA with a factor rate

• Factor rate: 1.20 (i.e. repay £36,000 over repayment period via sales split). If the payback period is short, effective APR can exceed 100%.
• Because MCAs are repaid from daily takings, calculate impact on daily cashflow before accepting — it can materially reduce gross sales available for stock and wages.

These examples show that an upfront fee vs ongoing discounting dramatically alters the perceived and effective cost. Request an APR equivalent or total repayment schedule from any lender or broker.

How UK Business Loans helps you get the best price

We don’t lend. We match businesses (loans from around £10,000) with lenders and brokers who specialise in your sector so you can compare real quotes quickly. Benefits:

• Fast matching to lenders/brokers likely to accept your case.
• Multiple quotes to compare interest, fees and repayment methods.
• Free, no‑obligation eligibility check — submitting an enquiry does not affect your credit score.
• Guidance on which costs to watch and how to compare offers on an apples‑to‑apples basis.

Ready to compare personalised quotes? Complete a short enquiry now: Get Quote Now — Free Eligibility Check.

For more background on how cashflow lending works and product details, see our dedicated cashflow loans resource: cashflow loans.

Questions to ask lenders before you sign

Use this checklist when comparing offers:

• What is the APR and how is it calculated?
• What up‑front fees are deducted or charged separately?
• Are there early repayment charges or roll‑over fees?
• How and when will repayments be collected (direct debit, sales split, card takings)?
• What happens if I miss a payment — default fees or penalties?
• Can I get a worked example showing total cost over the term?
• Who is my point of contact for queries and servicing?

Getting a quote — what details lenders typically need

To prepare for quotes, have the following ready:

• Company name, registration number and directors’ details.
• Annual turnover and recent monthly turnover trend.
• Time trading and brief description of the business purpose for the funds.
• Amount required (we focus on loans from around £10,000 upward) and preferred term.
• Recent bank statements (often 3 months) and details of existing debts.

Submit a short enquiry and lenders/brokers will call or email with tailored options: Start Your Free Enquiry.

FAQs

What rates and fees can I expect for a cashflow loan from UK Business Loans?

Indicative ranges are listed above. The exact rate depends on product type, business performance and security offered. For a personalised view, complete our simple enquiry and we’ll match you to suitable providers: Free Eligibility Check.

Will submitting an enquiry affect my credit score?

No — submitting your details through UK Business Loans does not affect your credit score. Lenders may undertake checks only if you proceed to a formal application.

How long until I receive quotes?

Many brokers and lenders respond within hours during business hours; typical turnaround is 24–72 hours once we pass your enquiry on.

Next steps — how to proceed

1. Click Get Quote Now and complete our short enquiry (about 90 seconds).
2. We match you to the lenders and brokers best suited to your sector and needs.
3. Compare the quotes you receive and choose the offer that best fits your cashflow and cost preferences.

Start your free eligibility check now: Get Quote Now — Free Eligibility Check

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Important: UK Business Loans is an introducer that connects businesses with lenders and brokers — we do not lend or provide regulated financial advice. All figures on this page are indicative and for comparison only; final terms are set by the lender or broker that contacts you. Enquiries do not affect your credit score.

For any further questions, visit our Contact page or complete the quick enquiry and we’ll put you in touch with a specialist who understands your sector.

1. What rates and fees should I expect for cashflow loans in the UK?
Typical ranges depend on product and profile — unsecured short‑term loans ~8%–35% APR, overdrafts ~8%–25% APR, invoice finance fees ~0.5%–3% per invoice (plus interest), MCAs often 40%–200%+ effective APR, plus arrangement/legal/valuation fees.

2. How do I compare APRs and fees between lenders and loan types?
Ask for a fully itemised cost schedule and a worked example showing total cost over the loan term (including all fees) so you can compare APR-equivalents and repayment methods apples‑to‑apples.

3. Can I get business finance if I have imperfect or poor credit?
Yes — some lenders and brokers in our network specialise in cases with imperfect credit, though rates and terms will typically reflect higher perceived risk.

4. What information and documents do lenders usually need to provide a quote?
Lenders typically ask for company details, recent turnover and monthly bank statements (often 3 months), trading history, amount requested and preferred term, plus details of existing debts.

5. How quickly will I receive quotes after submitting an enquiry?
Many lenders and brokers respond within hours, with a typical turnaround of 24–72 hours after UK Business Loans passes your details on.

6. Are Merchant Cash Advances (MCAs) a good option for cashflow?
MCAs can provide fast cash but are usually the most expensive cashflow option (effective APRs often 40%–200%+), so consider them only if other options are unavailable and you’ve modelled the impact on daily takings.

7. How much does invoice finance cost and how does it work?
Invoice finance advances 70%–90% of invoice value with fees commonly 0.5%–3% per invoice plus interest/discounting that varies with tenure, so overall cost depends on how long invoices remain outstanding.

8. What’s the difference between secured and unsecured cashflow loans?
Secured loans (backed by property or assets) generally offer lower interest (often 4%–12% APR) but involve valuations, legal fees and longer completion times, whereas unsecured loans are quicker but costlier.

9. Will submitting a UK Business Loans enquiry affect my credit score or is it a formal application?
No — submitting an enquiry is not a formal application and does not affect your credit score; lenders may only carry out credit checks if you proceed with an application.

10. Is UK Business Loans free, and do you lend directly or regulate the lenders?
Our service is free and we do not lend — we match you to trusted, usually FCA-regulated lenders and brokers so you can compare personalised quotes with no obligation.