How to get a business loan in the UK

1. Check you're eligible

FundBiz enquiries are only for limited companies, LLPs and partnerships with four or more partners, so we can't pass on an enquiry from a sole trader. Each lender then sets its own rules on business type, trading time and turnover, so read them before you apply. For example:

• Business type. iwoca asks that "you're based in the UK" and "you're a limited company or limited liability partnership".
• Trading time. iwoca says it accepts applications from "all businesses (no matter the age or industry)". Allica says your business "will need to have filed at least three years of accounts" for its business loans.
• Turnover. iwoca says you can borrow up to 20% of turnover. Funding Circle asks for details such as turnover and number of employees, and says it looks at "your credit score, bank transactions and trading history".

For more on who can enquire through FundBiz, read our eligibility guide for limited companies, LLPs and partnerships. For what an underwriter weighs up, see what lenders actually assess.

2. Pick the product

Start with what the money is for. A loan for a one-off purchase is a different product from cash to cover slow-paying customers. The decision times below are each lender's own figure for its own product, checked on its own page on 19 October 2026. One lender's figure is not a market figure.

A decision is not the same as money in your account. Funding Circle says that once you accept your offer, it deposits the money "typically within 48 hours". Allica says that if you provide all the documents and evidence it needs first time, you can get the money just as fast as the decision.

3. Get your documents ready

Lenders ask for documents before they decide. Each lender sets its own list, and it can change with the loan size. Here is what three lenders publish, read on their own pages on 22 October 2026:

• Business bank statements. Funding Circle may ask for "business bank statements for up to the last 6 months", showing the account name, sort code, account number and all daily transactions. Allica asks for three months of business bank statements up to £75,000, and six months above that. iwoca asks for "bank statements from the last year (or you can link your account via Open Banking)".
• Accounts. Funding Circle may ask for your "latest full unabbreviated accounts", including profit and loss and balance sheet. Allica asks for 12 months of management accounts (less than 60 days old) or full accounts for the last two years (less than six months old) up to £75,000, and two years of accounts above that.
• Details of other debts. Allica says you will need to share "details of all other debts".
• Shareholder details. Funding Circle asks for "the name, address and date of birth for your key shareholders", plus turnover and number of employees.
• What the money is for. Funding Circle says: "Be prepared to provide a clear explanation of what the funds will be used for."
• ID and proof of address. Funding Circle asks for "a copy of an ID document and proof of address" when you accept an offer.
• Consent to credit searches. Allica says you will "have to consent to personal credit searches for directors and beneficial owners".

iwoca adds that "the document requirements may change according to the loan size and type of company", so ask the lender for its list before you start. Our loan application prep checklist helps you gather everything in one place.

4. Apply: soft search or hard search, one application at a time

Before you apply, ask the lender what kind of credit search it will run. Experian explains the difference for personal credit reports. A soft search is a first look at your report: "Only you can see them on your report and it doesn't matter how many there are." A hard search is a full search when you apply: "Each hard check is recorded on your report, so any company searching it will be able to see that you've applied for credit." Experian adds that too many hard checks over a short period "can affect your credit score for six months".

Here is what some lenders say on their own pages:

• iwoca: "We only run soft credit checks which means applying won't affect your credit score. But if you decide to draw down funds from us, the business loan will show up on your credit report."
• Funding Circle: "Apply as a limited company without affecting your credit score".
• Capital on Tap: "Applying won't affect your credit score".
• Start Up Loans, on GOV.UK: "You'll need to pass a credit check."

Apply to one lender at a time. Several full applications in a few weeks means several hard searches, and the next lender can see them. If you are not sure which lender fits, check each one's published rules first rather than applying to all of them.

Many business loans also need a personal guarantee from a director. GOV.UK describes it as "a legally binding agreement that the director will personally repay a debt if the company fails to meet its financial obligations in relation to that debt." iwoca says its loans require one, and Allica says its business loans "are secured by a personal guarantee from your company's director(s) who are ultimate beneficial owner(s)." GOV.UK's advice is: "As with any legal or financial decision, you should consider getting independent specialist advice before proceeding." Our guide will a personal guarantee put my house at risk? explains what you are signing, and the personal guarantee checklist lists what to ask.

5. What happens after you apply

The lender checks your application and may come back with questions or ask for more documents. If it says yes, you get an offer with the amount, the rate or fee and the term. You sign the agreement, and any personal guarantee or other conditions, before the money is paid. Funding Circle, for example, says: "If a personal guarantee is required or there are any offer conditions, these will also need to be completed and returned."

Read the offer before you sign. Check the total you will repay in pounds, not just the rate. Our guide from application to funds, by product goes through each stage, and business loan interest rates shows the rates lenders publish.

6. If you're declined

Ask the lender why. The reason tells you what to fix, or which kind of lender to try next. Don't send a burst of new applications straight away, for the hard search reasons above. Our page on what to do when a business loan is declined covers who still lends and when it is better to wait.

Business loan eligibility checklist

Tick these off before you apply. Each line is based on what a lender publishes on its own page (read 22 October 2026); every lender has its own rules, so check the one you choose.

• ☐ Your business is a UK limited company or LLP. iwoca asks that "you're a limited company or limited liability partnership" and "you're based in the UK" (iwoca). FundBiz enquiries are for limited companies, LLPs and partnerships with four or more partners.
• ☐ You meet the lender's trading history rule. This varies a lot: iwoca accepts "all businesses (no matter the age or industry)", while Allica asks for at least three years of filed accounts (Allica).
• ☐ Your accounts are up to date. Funding Circle says that if it has been "over 2 years since you last filed your business accounts, we may require you to file fresh accounts" (Funding Circle).
• ☐ You have your business bank statements ready, or can link your account through Open Banking where the lender allows it (see step 3 above).
• ☐ You have checked your business credit report. Funding Circle says to "get a copy of your report and make sure it's accurate and up to date" (Funding Circle).
• ☐ You can show the business can afford the repayments. Allica, for example, asks for "evidence of at least 150% debt service cover" (Allica).
• ☐ You can say clearly what the money is for (Funding Circle, see step 3).
• ☐ You have a list of the company's other debts (Allica, see step 3).
• ☐ Each director knows whether a personal guarantee will be asked for, and has read GOV.UK's guidance on personal guarantees.
• ☐ You know whether the lender's first check is a soft search or a hard search (see step 4).

Print this checklist

Questions to ask before you choose a lender

• Do you lend to a business like mine, with my trading time and turnover?
• Is your first check a soft search or a hard search?
• How long do you usually take to decide, and how long after that to pay?
• Do you need a personal guarantee, and for how much?
• What is the total I will repay, in pounds?
• Can I repay early, and is there a fee if I do?
• Which documents do you need from me, and can I link my bank account instead?

Frequently asked questions

How do I get a business loan?

Check that your business fits the lender's rules, pick the type of finance that matches what the money is for, gather your bank statements and accounts, then apply to one lender at a time. Ask first whether the lender's check is a soft search or a hard search. FundBiz enquiries are for limited companies, LLPs and partnerships with four or more partners, not sole traders.

Can a new limited company get a business loan?

Sometimes, but the choice is smaller. iwoca says it accepts applications from all businesses, no matter the age, while Allica says a business needs to have filed at least three years of accounts for its business loans. A Start Up Loan is for businesses fully trading for less than 5 years, but it is a personal loan to you, not a loan to the company. GOV.UK says lenders are more likely to ask for a personal guarantee when the company is newly formed or has a limited trading history.

What documents do I need for a business loan?

It depends on the lender and the loan size. The lenders we checked on 22 October 2026 (Funding Circle, Allica Bank and iwoca) publish lists that include recent business bank statements, your latest accounts or management accounts, details of other debts, shareholder details, and ID and proof of address. Step 3 of this guide sets out each lender's own list with a link to its page. Ask the lender for its list before you apply.

Does applying affect my credit score?

It depends on the lender and the stage. iwoca says it only runs soft credit checks, so applying won't affect your credit score, but a loan you draw down will show on your credit report. Funding Circle says you can 'apply as a limited company without affecting your credit score'.

A Start Up Loan needs a credit check. Experian says each hard check is recorded on your report and can be seen by any company that searches it, so ask each lender which kind of search it runs before you apply.

This is general information, not advice. Each lender's terms can change, so check its own page before you apply. FundBiz is not a lender and does not run a credit check.

By Adam Parker, Founder & Managing Director, Muswell Rose. FundBiz is owned and operated by Best Business Loans Ltd, directed by Oliver Mackman. Last updated: 22 October 2026.