Discover the options available for self employed loans, how much you can borrow, eligibility criteria, necessary documents, and tips to maximise your chances of a successful application.
Self employed individuals, including sole traders, can get access to loans for their business. However, the process and what you need to provide can be quite different from traditional business loans. You’ll likely need to show more documentation to prove your income is stable enough for a loan. This could include your personal and business bank statements, profit and loss statements, tax returns, and sometimes even a detailed business plan. Lenders look at this information to assess your application and to make sure you can pay back the loan, especially since self employed incomes can vary a lot.
Self employed loans are designed to meet the financial needs of individuals who run their own businesses or work freelance. As with any other business loan, you'll borrow a sum of money and repay it, plus interest, over agreed-upon terms. How they work will depend on the type of self employed loan you opt for.
Different types of self employed loans that cater to different business needs. Each of the following loan options helps self employed individuals manage their finances, ensuring their businesses run smoothly and grow:
A small business loan is a versatile option for self employed individuals. Whether starting or expanding, a business loan provides necessary funds without needing a specific setup. These loans offer flexible terms and competitive rates, making them a solid choice for many self employed professionals.
If you run a store or a café and a significant part of your income comes from credit or debit card sales, a merchant cash advance could be an excellent option. With this type of loan, you receive cash upfront to cover expenses like inventory and equipment. You then repay the advance with a fixed percentage of your daily card sales, meaning your repayments fluctuate with your revenue. This flexible repayment plan ensures you pay less when your business is slower.
Asset finance is ideal for businesses that require heavy equipment, such as builders or landscapers needing diggers, or tractors. With asset finance, instead of paying a larger amount upfront, you spread the cost over time, which can help keep your cash flow steady.
For businesses that rely on reliable transportation - such as delivery drivers or mobile pet groomers, vehicle finance provides a manageable way to pay off a car or van in instalments.
This option helps you cover significant expenses gradually, ensuring your business can continue operating smoothly without a large financial burden at once.
Ideal for businesses that operate on invoice terms, such as freelance graphic designers or consultants. Invoice finance lets you borrow money against the amounts due from clients, giving you access to funds faster instead of waiting for them to pay.
Self employed loans can be used for various purposes, including:
Each lender will have different requirements. To apply for a self employed loan, you’ll usually need to provide:
If a self-employed loan isn't the best match for you, there are other options you could explore to fund your business.
Capitalise is an FCA regulated platform dedicated to UK businesses. Our mission is to help businesses to take control of their financial health. We support business owners by providing easy way to access over 100 lenders and compare their loan products. Our advanced platform makes intelligent matches and ranks lenders, based on their past successes, to help businesses select the best funding solution.
Capitalise also enables businesses to check their own Experian business credit score to better understand their financial health. Plus businesses can check the credit profiles of the companies they work with to reduce risk.
The amount you can borrow depends on factors such as your business's financial health, revenue, the strength of your business credit score, and the lender's policies. Use our Business Loan Calculator to estimate how much you can borrow, the total loan cost, and your monthly payments.
It's tough to find a self employed loan with no proof of income, as lenders will want to see evidence that you can repay. Some alternative lenders may offer solutions based on different criteria, though, for example based on the value of an asset you own.
To find the best self employed loans for your business, you can compare different lenders to see the different interest rates and terms you could be offered. At Capitalise we work with 100+ business lenders, allowing you to apply and compare multiple lenders in just one application.
Loans without a credit check are rare, as lenders usually want to see your credit history to make a decision. It may be possible to find a lender with less stringent checks, but you should expect higher interest rates.
United Kingdom 
South Africa 