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Having access to quick and flexible finance can empower business to seize a new opportunity, overcome financial challenges, or simply manage your day-to-day expenses. Short term business loans can provide this quick injection of capital with short and manageable repayment terms.
But before diving into an application, it’s important to understand how exactly these loans work and what you should consider before choosing one. Here’s what we’ll cover:
Short term business loans are are an excellent solution for bridging finance gaps. They are a type of lending product designed to provide businesses with smaller amounts of funding over a brief period, typically ranging from a few months to two years. These loans are often used to cover immediate expenses, such as purchasing more stock, covering an upcoming bill, or bridging gaps in cash flow. Unlike traditional bank loans, which may require extensive documentation, short term loans typically require less documentation and funds are dispersed much faster.
Short term business loans provide quick access to finance to help your business handle immediate needs such as covering unexpected expenses, or bridging a cash flow gap.
When you apply for a short term business loan, you’ll need to share details about your business’ financial health, like your revenue, profit and business credit score. If approved, you'll get a lump sum of money, which could be from £1000 up to £100,000+ depending on your individual circumstances. You'll then pay back this loan, along with interest, in regular instalments over a short period. This repayment period is usually three months up to a maximum of two years.
Keep in mind, because these loans are quick and convenient, they often come with higher interest rates. So, it's crucial to make sure you can comfortably repay what you borrow within the agreed time frame to avoid any financial strain on your business.
Here’s how the process for getting a short term business loan works with Capitalise:
Before applying for a short term loan, make sure to carefully assess your financial needs and determine whether a short term option aligns with your objectives. This type of funding is best suited for addressing immediate expenses or seizing short term opportunities, rather than long term investments.
While short term loans do offer quick access to capital, it's important that you weigh the cost of borrowing against the potential benefits. Higher interest rates and fees associated with short term loans can significantly impact the overall cost of borrowing.
You can use our business loan calculator to assess the total cost of the loan, as well as the monthly repayments to understand what you can afford to borrow. When you apply for a short term business loan with Capitalise, our funding specialists will also be on hand to help you understand all the associated costs so that you can make a well-informed decision.
Before committing to a short term loan, you could consider some other short term finance options in case they better suit your needs. Some examples include a line of credit, a business credit card, financing for business cars, or a revolving credit facility.
Each option has its advantages and disadvantages, so it’s essential to compare them based on factors such as interest rates, repayment terms, and eligibility requirements. If you’re unsure which option is right for you, just make sure to explain your funding needs and how your business operates when you apply for a business loan with Capitalise. Our funding specialists will use their expertise to match you with the lender and type of finance that works best for your business.
At Capitalise, we work with 100+ UK lenders to help you find better fit funding for your business. Whether you need to cover a short term cash flow gap, or you’re looking for a longer term investment, we can match you with the right lender. Just start a funding search today to get started.
Capitalise believe in creating a diverse, sustainable future. So we come up with new ideas, and see existing ones in a new light. We work with the people who share our vision, taking action to make a difference. We challenge businesses to find new ways to guide their futures.
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