When the money goes out
before it comes in

Any funding that covers the gap between money leaving your business and money arriving. It is a description of the problem rather than one product: a credit line, a short term loan, a term loan and revenue-based funding can all solve it, and which is cheapest depends almost entirely on how long you need the money for.

Some lenders on our panel decide online within minutes and most of the rest come back the same working day. When the money lands is the lender's call, so we give you a realistic date once we know which lender fits rather than promising one we do not control.

Enquiring with us involves no credit check at all, so it leaves no mark. If you decide to apply, most lenders on our panel run a soft search on the business and its directors to work out your offer, which only you can see. The full search other lenders can see normally comes if you accept, though a few run their checks earlier. We tell you which applies before anything is submitted.

Most unsecured business lending asks for a personal guarantee from a director, even where no asset is charged. A few facilities do not at smaller amounts. What is realistic, and where PG-free lending exists.

Sometimes. Several lenders weigh trading history, turnover and card takings more heavily than a credit score, and one is built around takings rather than accounts. It narrows the choice and usually costs more. We will tell you honestly whether it is placeable before anything is submitted.

Nothing. We charge you no fee at any point. We are paid commission by the lender if a facility completes, and our ranking ignores commission entirely. How that works.

Profit is what is left after costs over a period. Cash flow is when the money actually moves. A profitable business runs out of cash all the time, because it pays wages and suppliers before its customers pay it — and it is cash, not profit, that meets payroll on the 28th. Nearly everything on this page exists to bridge that timing gap rather than to fix a loss.

The money tied up in running day to day: stock you have bought, invoices you have raised and not been paid for, less what you owe suppliers. When it grows faster than your bank balance — which is what happens when you win work — you are funding your own growth out of the current account, and that is usually what people mean when they say they need cash flow finance.

It depends which of these you take. A short-term loan is commonly 6 to 18 months, a term loan up to 6 years, a revolving facility is repaid per drawdown over 1 to 12 months, and invoice finance is not a term at all — each advance clears when your customer pays. Matching the term to the gap is most of the decision, because paying for money after you stop needing it is the commonest way to overpay.

Yes, and most businesses never do. Under the Late Payment of Commercial Debts (Interest) Act 1998 you can charge statutory interest of 8% above the Bank of England base rate, plus a fixed sum for recovery costs — £40 on debts under £1,000, £70 up to £9,999.99 and £100 above that. One detail almost every page about this gets wrong: the rate is not today’s base rate. It is fixed twice a year, using the rate in force on 30 June for debts falling due in the second half of the year and on 31 December for the first. GOV.UK sets out the current figure. A contract can displace the statutory rate, so read yours first.

Four things, and only one of them is trading badly. Winning work, because growth consumes cash before it produces any. Customers paying later than your suppliers do. A lump that lands all at once — a VAT quarter, a PAYE bill, an annual insurance renewal. And seasonality, where four good months have to carry twelve. Each one has a different answer, which is why the page above is organised by problem rather than by product.

Arrange the facility in the good months, not the quiet ones. Lenders read the last three months of bank statements most closely, so applying in your strongest quarter puts your best figures in front of them, and a revolving facility then sits there unused and unpriced until the quiet half. Revenue-based funding flexes the other way, taking less in a slow month by design.