Business loans Scotland

What types of loans are available for businesses in Scotland?

In Scotland, businesses have a variety of loan options to consider. Each type of loan can suit different businesses, depending on their funding needs, the size of the loan and the financial health of the business. Here’s an overview of some common types of business loans available:

Term loans: These are traditional loans where a business borrows a fixed amount of money and repays it with interest over a predetermined period. They can be secured or unsecured, depending on whether collateral is provided.

Revolving credit facilities: This type of loan lets you borrow money up to a certain limit whenever you need it, and you only pay interest on what you use. It’s helpful for covering everyday expenses or unexpected costs.

Asset finance: If you need to buy equipment or machinery, you can use asset finance Usually the loan is secured against the asset being purchased. This means there is less risk to the lender, so they can be easier to obtain and may come with more favourable terms. 

Invoice financing: This allows businesses to borrow money against the amounts due from customers, helping to ease cash flow problems. 

Merchant cash advance: Ideal for Scottish businesses that take payment by card. This is a type of funding where a business receives a lump sum of money upfront and repays it through a percentage of their daily credit card sales.

Commercial mortgages: For businesses looking to buy or refinance commercial property, commercial mortgages are a long term financing option.

Start-up business loans: Aimed at new businesses, start-up loans can help provide capital for businesses without a long trading history. However they might come with higher interest rates and be tougher to get because they’re seen as riskier for lenders.

Government loans and small business grants in Scotland

Scotland offers a wide range of government loans and grants to help businesses grow, innovate, and become more environmentally friendly. Here are some of the main options available:
 

Scottish Growth Scheme

The Scottish Growth Scheme program offers £500 million in financial support to help Scottish businesses expand, including extra help for those in the Highlands and Islands.

Scottish Enterprise Grants

Scottish Enterprise can help businesses to access a number of grants. These grants cover various needs, including starting new projects, improving research and development, and expanding manufacturing facilities.

Skills Development Scotland

Skills Development Scotland is an agency that helps businesses get funding for training programs and to hire apprentices.

Business Energy Scotland

Business Energy Scotland is funded by the Scottish Government and aims to help businesses save energy, carbon and money. They offer unsecured interest-free loans to businesses that want to save money by using fewer resources and being more eco-friendly.

How to get a business loan in Scotland

Getting a business loan involves a few steps. Here’s how you can get a loan for your Scottish business with Capitalise:

1. Sign up to create a Capitalise for Business account and use our business loan calculator to see how much you could borrow. 

2. Start a search for funding. You'll be able to search from 100+ business lenders in the UK. 

3. Provide supporting documents to complete your application. You’ll likely need recent business bank statements and your last set of accounts if available. 

4. Next, you can speak with one of our funding specialists. They will help you finalise your application and apply to up to 4 lenders.

5. If approved, you’ll receive the details of the loan terms. This will include how much the lender wants to lend you, the interest rate and length of the term. 

6. If you accept the loan, you’ll receive the amount into your bank account. 

7. You will repay the loan in fixed monthly instalments over the agreed period. Each payment includes both principal (the original loan amount) and interest (the cost of borrowing).