What is commercial finance?
Commercial finance is a broad term for any financial product designed for businesses rather than individuals. It covers everything from unsecured working capital loans to complex property development funding โ and almost every type of business need in between.
Unlike retail banking products, commercial finance is typically negotiated rather than standardised. Rates, terms and criteria vary significantly between lenders and depend heavily on the specific circumstances of the business and the transaction.
The main commercial finance products
Fixed-term borrowing for any business purpose. Secured or unsecured. Repaid in monthly instalments. Best for one-off investment needs โ growth capital, equipment, acquisition, refurbishment.
Read more about business loans โRelease up to 90% of the value of unpaid invoices immediately. Revolving facility that scales with your sales. Ideal for B2B businesses with long payment terms. Includes factoring (with credit control) and invoice discounting (without).
Read more about invoice finance โSpread the cost of vehicles, machinery, equipment and technology over 1โ7 years. Hire purchase, finance lease and operating lease โ each with different ownership and tax implications. Also includes sale and leaseback.
Read more about asset finance โLong-term funding to buy or refinance commercial property. Owner-occupied or investment. Up to 75% LTV over terms to 25 years. Suitable for most commercial property types including retail, office, industrial and hospitality.
Read more about commercial mortgages โShort-term property-backed lending (1โ24 months) to bridge a gap before a long-term solution is in place. Fast completion. Auction purchases, chain-breaks, light refurbishment, pre-planning acquisition. Regulated and unregulated.
Read more about bridging finance โSpecialist short-term lending for property development projects โ ground-up residential, commercial development, conversions and refurbishments. Structured around the Gross Development Value (GDV) with staged build drawdowns.
Read more about development finance โAdvance based on card turnover, repaid as a percentage of daily card sales. No fixed term. Fast funding for retail and hospitality businesses. Priced using a factor rate rather than APR โ important to understand the true cost.
Read more about merchant cash advance โFund the gap between paying overseas suppliers and receiving customer payment. Import finance, letters of credit and supply chain finance for UK importers, exporters and product businesses.
Read more about trade finance โHow to choose the right product
The right product depends on what problem you're solving. A useful framework:
A 30-minute conversation with one of our brokers will give you complete clarity on the right product, the realistic cost, and which lenders are most likely to approve your application.
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