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Bad Credit Business Loans

Published on 25th September 2018 - Last update on 17th March 2020

Supporting your business as it goes forward isn’t always as straightforward as it may sound. In order to achieve a sustainable and prosperous future, possessing the capital to support growth, innovation and day-to-day operations is a prerequisite that no business can survive without. However, if you possess an adverse credit rating, qualifying for traditional forms of lending can prove difficult, especially if you’re an SME with a limited trading history. Naturally, you may be tempted to make use of your own savings or approach friends and family, but this can be a risky strategy to employ. Instead, the key to success could, in fact, lie elsewhere. The Alternative Finance industry is providing more and more UK businesses with access to the capital they need to achieve their goals, even with bad credit. So, if your business is in need of additional capital, you don’t need to carry this burden by yourself. Instead, take a look at what applying for a Bad Credit Business Loan could do for you.

What can Bad Credit Loans be used for?

Although it’s easy to assume that possessing an adverse credit rating will make achieving your goals more difficult, the reality is quite different. Because many of the business finance products on offer aren’t subject to any usage restrictions or borrowing limits (other than what the lender is willing or able to provide), a Bad Credit Loan can be used to benefit your business in any number of ways. So, in spite of adverse credit, you could still raise the funds you need to smooth uneven cash flow, pay corporation tax, resolve outstanding debt, fund existing projects, replenish supplies, support staff wages, release equity or even gain a cash injection. Therefore, adverse credit needn’t be a reason to delay or abandon your plans.

Are you looking for funds for your business? Worried about how your credit score may affect your application? Apply for a Bad Credit Business Loan or learn more about how your business could benefit.

What do I need to know when applying for a Bad Credit Loan?

When thinking about applying for finance, many business owners often believe that possessing an adverse credit rating will hinder their chances of being approved. Though it’s true that some products may lie beyond your reach as a result, there are still many solutions available that have been designed with this issue in mind. Nevertheless, lenders will still request permission to review your credit profile in order to understand the challenges you’re facing, but will, instead, base their decision on other aspects of your business. As such, you could receive a Bad Credit Loan on the back of past income, card-based (credit and debit card) sales, unpaid business-to-business (B2B) invoices, your inventory or even the equity held within your unencumbered assets (equipment, vehicles, machinery or property).

However, though adverse credit may not always lead to a rejection, it is likely to mean that lenders will charge your business more interest in line with the amount of risk involved, which is why you should always check your business credit score before applying and assess what you can do to improve your situation. If there are things you can do, it may improve your score and allow you to receive a more favourable interest rate, saving your business money in the long-run.

What types of Bad Credit Loans are available?

Naturally, every business owner wants to avoid possessing an adverse credit rating. But sometimes you may run into situations that can negatively affect your finances. Yet no matter what the cause of the situation may be, it’s by no means the end of the road. Thanks to the Alternative Finance industry, more and more UK business owners are realising that the funding opportunities available to them aren’t as limited as they first thought. So if you’re looking to raise capital with an adverse credit rating, some of the products available to you could include Secured Business Loans, Invoice Finance, Overdraft Replacement and Merchant Cash Advance (MCA). However, in order to make an informed decision, you must appreciate how each of these products work, which is where speaking with a qualified business finance professional can help.

Looking to apply for a Bad Credit Loan?

Deciding to apply for business finance when you have an adverse credit rating can be as intimidating as it is frustrating. You may find that many conventional lending institutions consider you as being too great a risk, leading to them rejecting your application, especially if you’re an SME. But rather than use the traditional route, why not explore another path? The Alternative Finance industry is paving the way for a new generation of lenders and finance products, making the UK lending landscape more dynamic and accessible than ever before. As such, all you need to do is source an agreement from a lender you can trust, which is where we can help.

Rangewell is an Access to Finance specialist, meaning we have mapped over 400 lenders to offer you an overview of more than 23,000 business finance products. Our services are free to use and we’ll also guide you through the entire process - from search to acceptance. So, if you’re looking to raise funds for your business in spite of possessing an adverse credit rating, apply for a Small Business Loan for bad credit today or find out more with Rangewell.


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David Harrison

David Harrison

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