What Credit Score Do You Need for a Business Loan?

What Credit Score Do You Need for a Business Loan?

There’s no single minimum, and it varies far more by lender than by anything about your business. High-street banks (Barclays, Lloyds, NatWest) do not publish a minimum score, but they expect a clean personal and business credit history. Specialist lenders like iwoca and Capify are more flexible: Capify says it looks at all credit profiles.

In the lenders we compared, the lower the rate, the higher the score you need to reach it. That is the real gap between the two ends of this market.

If your credit file is weak, Capify and iwoca are your most accessible options; both can decide the same day without a hard search on initial enquiry. For a file with serious adverse marks, see our full business loan with bad credit comparison for every accessible option.

When you apply, the lender pulls your personal credit file and your business file, and both have to clear their own bar. For limited companies the two are assessed separately, which is why a strong personal score partially offsets a thin business file, particularly for companies trading under two years. Your own score does the heavy lifting on the day the company file is still too young to lend against.

How Are Business Credit Scores Calculated?

The three main UK credit reference agencies, Experian, Equifax and TransUnion, each use different scoring scales, and a business score is not the same as a personal one. Experian scores a business 0 to 100. On your personal file, Experian runs 0 to 1250 and Equifax 0 to 1000, while TransUnion is moving from 0 to 710 to 0 to 999, phased in between late September 2026 and June 2027. Lenders may check one or all three, so a number that looks respectable on one scale can look thin on another.

Payment history is usually the biggest influence on your business credit score. Lenders also look at how much of your available credit you use, the age of the file, County Court Judgments (CCJs) and whether your Companies House registration is verified. That is why a young company with a spotless record can still score below an older business that has made the odd late payment.

CCJs do the most damage, and even a satisfied CCJ stays on your file for six years. If you have one, resolve it before you touch anything else on the file, because nothing else you can do moves the number as far.

How to Check Your Business Credit Score

For your personal credit file, which lenders check alongside your business file, Credit Karma, Experian and ClearScore all offer free checks. Checking your own file is a soft search: it leaves no mark, and no lender ever sees that you looked.

For your business credit file, Creditsafe offers a free company credit report. Experian’s My Business Profile gives a company director the full commercial report, free for two months and then £24.99 plus VAT a month.

We recommend doing this before you apply rather than after, and the reason is practical. If you log in on a Monday morning and find an error on the file, you have room to dispute it and wait for the correction. If the lender finds it first, you have spent a hard search on a decline you could have avoided, and a dispute takes weeks rather than days to work through.

How to Improve Your Credit Score Before Applying

If you have three to six months before you need the loan, these are the steps that actually move the number:

1. Register at Companies House if you’re a limited company. A verified address and director details build your business credit file.

2. Pay all supplier invoices on time. Trade credit history is reported and weighted heavily. 3. Reduce credit card utilisation below 30% of your limit before applying.

4. Check for errors on your business credit file. An incorrect CCJ, or a missed payment that was never yours, can drag the score down on its own, and you will be chasing the credit agency for weeks to get it removed. Dispute it directly, and start early.

5. Avoid multiple applications in a short window. Each hard search leaves a fresh mark on your credit file, so use lenders that offer an eligibility check before a full application.

6. Build a trading history. Using a dedicated business account consistently creates a financial record lenders can assess.

Which Lenders Accept Lower Credit Scores?

Of these three lenders, Capify is the clearest starting point for a weak credit file, because it says it looks at all credit profiles. It also considers trading performance rather than relying on the score alone.

iwoca sets no minimum trading period for limited companies and LLPs (loans are capped at £10,000 under a year of trading), and reads your bank statements alongside the credit file, so a thin file matters less where the account itself looks healthy. Both set their published criteria below the level a high-street bank works to.

High-street banks (Barclays, NatWest, Lloyds) require standard creditworthiness, and they are not the place to start if your record is adverse. Funding Circle sits in the middle: a strong credit history helps, but it decides on business performance data rather than a fixed score threshold.

If you’re a limited company with a CCJ from a supplier dispute three years ago, Capify or iwoca is your realistic starting point. Capify’s application takes around 10 minutes online with a decision the same day, where a high-street bank leaves a hard search on your file for twelve months and you are still waiting on the answer in the week a specialist would already have said yes. If you apply to the bank first, that wasted search costs you more than the rate.

Credit Score FAQs