Tide Funding Options
Funding Circle Business Loan
iwoca Business Loan
Capify Business Loan
Barclays Business Loan
Fleximize Business Loan
How Unsecured Business Loans Work
Loan Amounts, Terms and What Unsecured Means
An unsecured loan needs no asset as collateral, so you’re borrowing against your trading record and cash flow, not your premises.
You’ll find amounts smaller and terms shorter than secured lending: typically £1,000 to £100,000 from a bank, up to £750,000 from Funding Circle, over one to five years.
No asset on the line is the appeal. That’s what you’re paying a higher rate for.
Why Unsecured Still Means a Personal Guarantee
Above £25,000, almost every unsecured loan still asks you for a personal guarantee as a director, so the lender has a route to you if the company fails.
Unsecured means no charge over a specific asset, not no liability; if the company defaults, the lender can pursue your home or savings.
Unsecured isn’t risk-free for you. That’s the part the headline rate hides.
How Unsecured Loans Fund and Repay
You can have money fast: iwoca and Capify often decide the same day in the cases we see, Funding Circle funds within 24 to 48 hours, while a high-street bank takes days.
Picture your accountant uploading the bank statements through Open Banking on a Friday while you wait, and the offer lands that afternoon.
Unsecured Business Loan Costs and Fees
Interest Rates and Representative APR
You’ll pay more than on a secured loan: 7% to 15% APR from a high-street bank, and 15% to 50% or higher from alternative lenders.
The Bank of England base rate sets the floor at 3.75%, and the rest is the lender’s risk premium for taking no security.
Funding Circle starts from 6.9% for the strongest limited companies, while iwoca’s representative APR is 49%, and we rate it on speed, not price.
The fast money costs you most. That’s the trade you’re making.
Fees, Factor Rates and the True Cost
Your headline APR isn’t the whole bill. Funding Circle adds a 1% to 3% completion fee, and Capify prices on a factor rate rather than an APR.
A factor rate of 1.25 means you repay £1.25 for every £1 borrowed, whatever the timeframe, which can work out above 60% effective APR.
Always read the total cost, not the rate. That’s what protects you.
Early Repayment Charges on Unsecured Loans
If you might repay early, check the small print: Funding Circle, iwoca and Fleximize charge no early settlement fee, but HSBC adds a month-plus-interest penalty.
You’ll usually find banks waive arrangement fees on small loans, while specialists fold their costs into the rate or a completion fee instead.
Eligibility for Unsecured Business Loans
Trading History and Business Structure
Your trading history and structure decide your options: Funding Circle wants two years and lends only to limited companies and LLPs, while iwoca needs just a few months.
Sole traders are increasingly shut out; Funding Circle and iwoca both dropped them, so a bank, Capify or a Start Up Loan may be your route.
Picture your accountant exporting the management accounts for the underwriter while you wait on a same-day decision.
Credit Score, Turnover and Affordability
Your credit file still shapes the rate, and a clean record opens the cheapest bank and Funding Circle pricing.
Specialists lean on your turnover and cash flow instead: Capify wants at least £10,000 a month and, in our checks, weighs card takings over a perfect score.
Thin credit doesn’t lock you out. It just costs you more.
Bad Credit and Adverse History
If you’ve had a CCJ or default, Capify and iwoca, the lenders we rate for adverse credit, will still look, pricing the risk into a higher rate rather than declining you outright.
If your credit is adverse, a high-street bank will usually decline automatically, so don’t waste a hard search there first.
How to Compare Unsecured Business Loan Lenders
Comparing Lenders by Cost
If cost is your priority, compare what the loan costs your cash flow over the full term: the rate, any completion fee and the factor rate, not just the headline APR.
You’ll get the lowest price from Funding Circle and the banks we rate for clean, established companies, while the fast specialists cost more for speed and access.
Comparing Lenders by Speed
If you need cash this week, iwoca, Capify and Fleximize, the three we rate fastest, decide fast and fund within a day or two, where a bank can take a fortnight.
Open Banking is why: it lets a lender read your account in minutes instead of waiting on filed accounts.
Comparing Lenders by Amount and Flexibility
Match the lender to what you need: up to £100,000 from a bank, £750,000 from Funding Circle, or a revolving Flexi-Loan from iwoca you draw and repay as you go.
The right lender fits your case, not the biggest brand. That’s the call that saves you money.
Who Unsecured Business Loans Are Best For
Best for Established Companies on an Unsecured Loan
If you’re an established limited company with two years of accounts and a clean credit file, Funding Circle or your bank give you the lowest unsecured rate.
We rate Funding Circle top here on price for the companies that qualify, with the banks close behind for relationship customers.
Best for Fast Cash or Thin Credit
If you need money this week or your credit file is thin, iwoca and Capify trade a higher rate for speed and a yes.
Picture your accountant emailing three months of statements to a specialist on a Friday while you wait to hear the same day.
When an Unsecured Loan Is Not the Best Fit
If you can pledge an asset, a secured loan is cheaper for large or long borrowing, and invoice finance suits cash tied up in unpaid invoices.
Speed and no asset at risk are the unsecured trade-off. For a startup, a Start Up Loan at 7.5% fixed with no guarantee may beat them all.
Frequently Asked Questions
What is an unsecured business loan?
An unsecured business loan is borrowing that needs no specific asset as collateral. The lender weighs your cash flow, credit file and trading record instead. Because there is no asset to recover, rates are higher and amounts smaller than a secured loan, and a personal guarantee is usually required.
How much can you borrow with an unsecured business loan?
High-street banks lend up to £100,000 unsecured (HSBC caps its standard small business loan at £25,000). Specialists go higher: Funding Circle up to £750,000 and iwoca up to £1,000,000. The amount you are offered depends on turnover, trading history and affordability.
Do you need a personal guarantee for an unsecured business loan?
Almost always, for any limited-company loan above £25,000. The guarantee makes you personally liable if the business defaults, so the lender can pursue your personal assets. Government-backed micro-finance such as the Start Up Loan (up to £25,000) is the main exception with no guarantee.
Can you get an unsecured business loan with bad credit?
Yes. Capify and iwoca consider adverse credit and CCJs, pricing the risk into a higher rate or a factor rate rather than declining outright. A high-street bank will usually reject adverse credit automatically, so start with a specialist rather than burning a hard search at a bank.
How fast can you get an unsecured business loan?
Specialists are quickest: iwoca and Capify often decide the same day and fund within 24 hours using Open Banking, and Fleximize funds within 48 hours. Funding Circle typically funds in 24 to 48 hours. High-street banks are slower, usually several days to a few weeks.
Can sole traders get an unsecured business loan?
It is harder than it was. Funding Circle and iwoca both stopped lending to sole traders in 2026, restricting to limited companies, LLPs and (for iwoca) registered partnerships. Sole traders can still use Capify, some high-street bank loans, or the government Start Up Loan scheme.
How We Reviewed Unsecured Business Loan Lenders
Ranking criteria. We ranked lenders on rate, loan size, speed and how flexibly they handle thinner credit or shorter trading histories. Cost and eligibility carry the most weight, because they decide whether a loan is affordable and whether you can get one at all.
Data sources. Rates, limits and eligibility were checked directly against each lender in June 2026: Funding Circle, iwoca, Capify, Fleximize and Barclays. No comparison sites and no press releases.
Update cadence. We re-verify every lender on this page at least monthly, and whenever a lender changes pricing, eligibility or terms. The verification date reflects the most recent full review. Some links on this page are affiliate links, see our editorial policy.
Regulatory note. This is editorial content, not regulated financial advice. Lending to limited companies is generally unregulated. Credit is subject to status and approval; compare offers directly with lenders before you apply.