Large Business Loans

Written by Richard Wilcock | October 31, 2024

Table of contents

• What’s a large business loan?
• How does a large business loan work?
• Do I qualify for a large business loan?
• Different types of large business loans
• What can I use my large business loan for?
• Large business loan calculator
• Getting a large business loan

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If you require substantial working capital to fund business operations — from hiring top talent to replacing equipment or expanding your premises, you can apply to access up to £10 million. We work alongside a panel of UK alternative lenders to help you find and compare the best loan rates for your business needs.

What’s a large business loan?

A large business loan is specifically designed for businesses that want to invest heavily in their organisation. So, if you’re an established business looking to borrow up to £10 million, a large business loan could be an option worth exploring. Most lenders won’t have spending restrictions, so you can spend this injection of working capital as you see fit.

How does a large business loan work?

The process of applying for a loan starts with getting a quote:

1. After you accept the quote, you fill in a loan application
2. The loan is then underwritten (i.e. the lender checks your financial statements)
3. The terms are agreed upon
4. If you accept the loan terms, the lender will transfer the funds into your bank account, ready to spend

If you apply for a traditional business loan, you’ll get a lump sum in your bank account and repay the loan in fixed monthly instalments, with interest, until you’ve repaid the loan in full.

But if you apply for a merchant cash advance, you repay these in line with your monthly credit card sales. You’ll pre-agree a percentage to repay each month, usually around 10%. A cash advance can be useful if you don’t want to repay fixed monthly amounts.

Different types of finance have different repayment schedules; always consider which type of loan would work best for you.

Do I qualify for a large business loan?

If you meet the basic criteria below, you might qualify for a large business loan:

• UK registered business
• Over 3 months of trading history
• A high-value asset (if applying for a secured loan)
• Good credit (particularly if applying for an unsecured loan)

Each lender has different criteria, so always read their loan terms carefully before proceeding with your application. Please note for large loans; the lender may require you to sign a personal guarantee if you’re not securing it with collateral.

Different types of large business loans

The type of loan that suits you best depends on your circumstances, whether you have collateral, good credit and more.

Are large business loans secured or unsecured?

These loans can be both secured and unsecured. Which one you choose largely depends on your financial situation, i.e. do you have or do you want to risk a commercial asset? You put an asset at risk when applying for a secured loan, but you can enjoy higher loan amounts, lower interest rates and longer repayment periods.

But, if you opt for an unsecured loan, although your assets will be safe, you’ll pay higher interest rates, and the lender will cap your borrowing amount, but you’ll receive funds quicker.

Always take the time to understand the options available to you.

Invoice finance

Invoice finance allows you to unlock cash tied up in your unpaid invoices. So, invoice your customers as usual and digitally upload the invoices you wish to sell. They’ll immediately front you up to 95% of the total invoice value.

Business loans

One of the more traditional types of business finance is a business loan. Loans can be unsecured or secured and usually require you to have been trading for over 3 months. You can access more than £500,000 with an unsecured loan and more than £2 million with a secured loan.

Merchant cash advance

A merchant cash advance is an advance on your sales. Rather than paying fixed repayments, you repay a cash advance by repaying a percentage of your monthly sales. Eligibility criteria include taking at least £2,500 in monthly card sales and accepting credit and debit card payments.

Working capital loan

If you’re looking for short-term funding, a working capital loan can give you access to the money you need to pay wages or generally keep business operations running efficiently. You can access up to £250,000 with an unsecured working capital loan if you've got good credit.

Asset finance

Asset finance can be a good option if you want to free up cash tied into your business assets or purchase or lease new equipment. This type of finance means you can better manage your cash flow instead of purchasing expensive equipment like machinery outright.

What can I use my large business loan for?

Most lenders won’t restrict how you spend your loan. But most businesses use this substantial cash injection for the following reasons:

• Fund business expansion. Open new premises, expand existing premises or explore new markets.
• Acquire new businesses. Large business loans offer the capital needed to buy out other businesses and increase your market share.
• Replace old machinery and equipment. Upgrading existing equipment can improve productivity and boost efficiency across the business.
• Consolidate your debts. By consolidating your debts, you’ll only have one loan repayment a month, and you can access more competitive interest rates to save money.
• Better manage cash flow. Cash flow is the lifeblood of any business, and a loan can help you manage your short-term cash flow effectively.

Large business loan calculator

Our calculator can help you determine how much you can borrow and roughly how much it will cost you:

Please note large business loan interest rates will vary depending on the provider and your circumstances. For example, if you apply for a secured loan, you’ll likely access a more competitive interest rate.

Getting a large business loan

Applying for a large business loan is quick and easy when using our free loan comparison service. Simply share a few details about your business and how much you’d like to borrow. And we’ll instantly show you relevant loans.

Take your time to compare total repayable, rates and more with our handy table format. Expand each loan offer to learn more, and click through to the lender’s website to continue with your application.

By comparing business loans, you can be sure you’re choosing the right one for your business needs. Getting a quote won’t affect your credit score. Compare business loans.

About the author

Written by Richard Wilcock

Money Writer, Director and Co-Founder

Richard is one of the Co-Founders here at Capalona and has over twenty years of experience in the marketing industry, specialising in the finance sector.

Updated: October 31, 2024
Published: January 22, 2024