What is an Unsecured Business Loan (UBL)?

An Unsecured Business Loan doesn’t necessitate collateral or assets as security. Approval is based on the borrower’s creditworthiness, financial strength, and factors like credit history, business performance, and cashflow.
These loans provide flexibility and accessible funds, especially beneficial for businesses without substantial assets for security. (Note: Unsecured Business Loans often require a personal guarantee).
  • Key Eligibility Criteria:
  • Min £100k turnover
  • The business is a limited company
  • 6 months trading history (ideal)
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Benefits at a glance

No Collateral

Unsecured Business Loans do not require collateral or assets to secure the loan, making them accessible to businesses that may not have valuable assets to offer as security. They do however often require a personal guarantee.

Streamlined Application

Unsecured loans typically feature a streamlined application process and faster approval times in comparison to secured loans, enabling businesses to swiftly access funds.

Credit Opportunities

Successful repayment of unsecured loans can contribute to building or enhancing a business’s credit history. This positive credit track record may open doors to better credit opportunities in the future, such as lower interest rates or
higher loan amounts.

  • Most common industries:
  • Scaling SMEs
  • Retailers
  • Consultants
  • Service Providers
  • Marketing Agencies
  • Healthcare
  • Construction

How do Unsecured Business Loans (UBL) work?

Unsecured Business Loans offer businesses the flexibility to secure upfront capital without requiring collateral against the loan. Lenders commonly seek a personal guarantee, where the borrower commits to using personal funds to repay the loan if the business encounters challenges in meeting its repayment obligations. Occasionally, this commitment extends to include the borrower’s spouse, emphasising a shared responsibility for the loan’s repayment.
To gain insight into the financial well-being of the business, lenders will analyse the company’s financials. This enables lenders to evaluate the borrower’s capacity to effectively manage loan repayments.
The assessment process, encompassing credit checks, personal guarantees, and review of financial documents, is a customary practice aimed at ensuring responsible lending. By maintaining transparency and providing the necessary documentation, borrowers can streamline the application process, increasing the likelihood of securing the funds they need for their business requirements.

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