Business Loans
Short Term Business Loans

Compare Short Term Business Loans

Various types of business finance are available with terms of under 12 months
Short term loans can be used many purposes including unexpected costs and cash flow problems
We can help you compare short term funding options from business loans specialists

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Information written by Holly Bennett Last updated on 20 June 2022.

A short-term business loan may be an option if you need to take out a loan to finance your business but don’t want to be locked into an arrangement for a few years.

There is no one-size fits all approach, as there are a few different types depending on what you are looking to fund. This could be anything from paying unexpected costs to getting expensive equipment to help your business grow.

As with any loan, consider the interest rate and how long you will be making repayments, so you know the total cost. It’s important to only borrow what you can afford to pay back. Also, consider any set-up fees as part of the agreement. To find the lowest cost agreement to suit your business, it makes sense to compare loan terms across different providers.

To make it easy, you could compare features such as minimum turnover requirements and available amounts across providers using the comparison table below.

What are short-term business loans?

Short-term business loans are a type of loan that you pay back relatively quickly. The terms usually last from a month up to a year. Over that time, you pay back the original loan plus interest charged with fixed, regular payments.

Borrowing amounts for short-term loans can range from £1,000 up to £1 million. But how much your business can borrow depends on a few factors. These include what you plan to use the money for, your business finances and how long you’ve been trading, and the provider’s terms.

Types of short-term business loans

There are a few ways you could borrow for a short period of time. You’ll want to identify the one that suits what you’re funding. When you apply, you will need to explain what you will use the money for.

Some short-term options might be:

Business loan: This is a standard loan arrangement where you borrow a set amount plus interest and pay it back over a period of time. This can be an unsecured or secured loan, though most short-term loans are unsecured.
Invoice financing: This is a way for businesses to borrow money against unpaid invoices.
Asset financing: This helps businesses to use high-value equipment, such as machinery or vehicles, for a short period, without having to buy it outright and up front.
Business credit lines: This lets a business draw cash when it needs it, and only pay interest on the amount borrowed.
Peer-to-peer lending: This is where private investors lend to your business through an online platform.

Advantages of short-term business loans

You may be keen to take the short-term borrowing route for the following reasons:

You pay less total interest, as you are paying interest for a shorter period of time.
You won’t be paying off a loan for long.
You may not need any security for the loan.
The approval process may be faster than with a long-term loan.
There may be less paperwork than with a longer borrowing agreement.
You may get quick access to capital, sometimes within just one to two days.

Disadvantages of short-term business loans

It’s sensible to properly consider if this is the right route for your business. As part of that, you should be aware that, when compared with longer term loans:

Interest rates can be higher.
They are a short fix, and not the answer to longer-term cash flow problems.
The lender may charge an early repayment fee if you pay the loan off sooner than the agreed term.
There may be arrangement fees for the loan.

Can I get a short-term business loan?

This will depend on your business and the lender, but you will need to meet the following criteria:

You are aged 18 or over.
You are the owner or director of a limited company registered in the UK.
Your business has a minimum monthly turnover.
Your business has a minimum trading time.
You have a business bank account.

The lender will want to consider your business financials, and will run a credit check to get a view of your business’s borrowing history and credit score, before deciding if it can offer the loan and the interest rate they will charge. The lender may also run a personal credit check.

The paperwork for short-term loans may be relatively light. But you will need to supply basic business information, including annual turnover, and will likely be asked to supply recent business bank statements. You will also need to state the purpose of the loan.

How can I compare short-term business loans?

You can use our comparison table to compare loans from business loan specialists. You’ll see what your business turnover and trading requirements must be at a glance. You can also see the range of term lengths and minimum and maximum amounts available.

Once you have chosen the borrowing that’s right for your purpose and business, you can go direct to the broker or lender and start your application.

Short Term Business Loans FAQs

How long is a short-term business loan?

Providers offer short-term business loans with terms that range from a month to a year. This is the period of time you will have to pay off the loan plus interest.

Why would a business use short-term loans?

You could be looking for funding for your business for a few reasons:

To help get your start up off the ground.
To help manage cash flow.
To help upskill staff with training.
To hire new staff.
For marketing and promotional purposes.
To secure expensive equipment to help your business expand.
To help cover an unexpected expense.

What is an example of a short-term business loan?

Businesses take out short-term loans for a wide range of reasons. One example could be where a business needs to buy stock and equipment to meet customer demand.

What are three types of short-term business financing?

Three routes to short-term finance could be invoice finance to borrow against unpaid invoices, tax loans to help your business pay a tax bill, and business credit lines.

Will I need a personal guarantee to get a short-term business loan?

Some providers that offer unsecured lending to limited businesses can sometimes ask for a personal guarantee from a director. This means that if the company can’t repay the loan, the director becomes liable. This isn’t always the case, though. So check the provider’s terms before you apply.

» MORE: What to know before signing a personal guarantee

About the author:

Holly champions clear, jargon-free writing. She’s been creating finance content for leading organisations for over 10 years. Read more

Compare Short Term Business Loans

5 products found

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Broker
Love Finance Short Term Business Loans

Apply for short term finance and borrow up to £250,000

Find out which short term offers you are eligible for without affecting your credit rating

Same-day funding available
Minimum Turnover
£50,000 p.a.

Available Amounts
£5,000 to £250,000

Available Terms
3 months to 1 year

See Deal + More info
Company details
- Love Finance is a lender and broker
- Get a decision in minutes via a simple online form
- Get funding within 24 hours
Eligibility Criteria
- Must have been trading for at least 12 months
- Must have clean credit or no CCJs
Funding Circle Short Term Business Loans

Flexible, short-term business loans from £10,000 to £50,000 to help you manage cash flow

Only pay interest on the time you borrow — no fees and you can settle early at any time

12 to 24 month terms — ideal for bridging gaps, boosting cash flow, buying stock and other short-term needs
Minimum Turnover
£25,000 p.a.

Available Amounts
£10,000 to £50,000

Available Terms
1 to 2 years

See Deal + More info
Company details
- Fast, hassle-free business finance from £10,000 to £500,000 at competitive, fixed rates
- Apply online in minutes, get a decision in as little as 1 hour and funds typically within 48 hours
- UK-based support team — rated ‘Excellent’ on TrustPilot
Eligibility Criteria
- Must have a minimum of 12 months’ trading history
Broker
Swoop Funding Short Term Business Loans

Short-term business finance with terms up to one year

Secured and unsecured options available

Quick access to funds
Minimum Turnover
£50,000 p.a.

Available Amounts
£3,000 to £600,000

Available Terms
1 month to 1 year

See Deal + More info
Company details
- Simple, secure and speedy search of 1,000 funding providers without affecting your credit rating
- Free access every type of finance including the Recovery Loan Scheme
- Online management allows you to find funding opportunities and track applications
Eligibility Criteria
- Must be based in the UK
- Must have an annual turnover of £50,000+
- Must have been trading for 12 months or more
Broker
Funding Xchange Short Term Business Loans

Discover instant & personalised short term finance offers for your business in just 3 minutes

Compare Business loan options from 45+ lenders, including exclusive deals, to save you time

Never pay more than direct & funding can be accessed in less than 24 hours
Minimum Turnover
£100,000 p.a.

Available Amounts
£1,000 to £250,000

Available Terms
1 to 12 months

See Deal + More info
Company details
- Access 70 lenders from one simple funding request
- Easily compare the choices available, including RLS options
- Apply with confidence, no impact on your credit score
Eligibility Criteria
- Your business must have been trading for a minimum of 2 years
- Your business must have an annual turnover of at least £100,000
Cubefunder Short Term Business Loans

Only available to Limited Companies in England and Wales with 3+ months' trading

Borrow up to £100,000 on a short term for any business purpose

No penalty fees, only pay for the time you use the loan

Flexible, tailored repayment schedule to fit in with your cash flow
Minimum Turnover
£50,000 p.a.

Available Amounts
£5,000 to £100,000

Available Terms
3 months to 1 year

See Deal + More info
Company details
- Fast and Flexible funding from £5,000 - £100,000 for Limited Companies within England and Wales
- No penalties for Late payments or Early repayment
- Apply and receive funds within 48 hours
Eligibility Criteria
- Must have a minimum Turnover of £4,000 per month
- Must have been trading for at least 3 months
- Must be a Limited Company trading within England and Wales
- Must have a UK Business Bank Account
- Director must control shares
- Up to 3 Directors (tolerance)

Suppliers that don't offer Short Term Business Loans but may offer suitable alternatives:

Nationwide Finance Business Finance

Nationwide Finance help 35,000 businesses get finance each year

Direct funder - not a broker

Same day decision, funds within 24 hours
Minimum Turnover
No minimum

Available Amounts
£8,000 to £500,000

Available Terms
1 to 5 years

See Deal
Company details
- Nationwide Finance help 35,000 businesses get finance each year
- Direct funder - not a broker
- Same day decision, funds within 24 hours
Eligibility Criteria
- Nationwide Finance help 35,000 businesses get finance each year
- Direct funder - not a broker
- Same day decision, funds within 24 hours
Broker
Tide

Tide works with a number of partners who offer a range of flexible business funding solutions

They will run pre-eligibility checks, without affecting your credit score, to show you credit options tailored to your business

Connect your business bank account in minutes to see your credit options and receive a £75 Uber/Uber Eats voucher (Terms & Conditions apply)
Minimum Turnover
Varies

Available Amounts
£500 to £15,000,000

Available Terms
1 month to 6 years

See Deal
Company details
- Tide works with a number of partners who offer a range of flexible business funding solutions
- They will run pre-eligibility checks, without affecting your credit score, to show you credit options tailored to your business
- Connect your business bank account in minutes to see your credit options
Eligibility Criteria
iwoca

Flexible finance for small businesses from £1,000 to £500,000

No long term commitments and flexible repayments to fit for your business

Apply online in minutes for a decision (some decisions may take up to 24 hours)
Minimum Turnover
£50,000 p.a.

Available Amounts
£1,000 to £500,000

Available Terms
up to 24 months

See Deal
Company details
- Flexible finance for small businesses from £1,000 to £500,000
- No long term commitments and flexible repayments to fit for your business
- Apply online in minutes for a decision (some decisions may take up to 24 hours)
Eligibility Criteria
- Flexible finance for small businesses from £1,000 to £500,000
- No long term commitments and flexible repayments to fit for your business
- Apply online in minutes for a decision (some decisions may take up to 24 hours)
365 Business Finance

Your business must process credit and debit card transactions to apply for this product

A flexible business funding alternative

Cash advanced against card transactions

Pay back an affordable % of your card transactions
Minimum Turnover
£10,000+ card transactions per month

Available Amounts
£10,000 to £300,000

Available Terms
4 to 18 months

See Deal
Company details
- Get between £10,000 and £300,000
- Pay back through your customer card transactions
- A single all inclusive charge that never changes
- No interest, APRs or hidden extras
Eligibility Criteria
- Your business must have been trading for at least 6 months
- Your business must accept debit and credit card payments
- Your business must take at least £10,000 per month in card transactions.
Fleximize

YOUR BUSINESS MUST BE A LIMITED COMPANY WITH 6+ MONTHS' TRADING

Industry-leading flexibility - top-ups, repayment holidays, penalty-free early repayment, no set-up fees

Interest charged on reducing balance, not total loan amount - repay early and only pay for the time you had the loan

Apply online in five minutes, typically get a decision in 24 to 48 hours, receive funds the same day
Minimum Turnover
£60,000 p.a.

Available Amounts
£5,000 to £500,000

Available Terms
3 months to 5 years

See Deal
Company details
- Industry-leading flexibility - top-ups, repayment holidays, penalty-free early repayment, no set-up fees
- Interest charged on reducing balance, not total loan amount - repay early and only pay for the time you had the loan
- Apply online in five minutes, typically get a decision in 24 to 48 hours, receive funds the same day
Eligibility Criteria
Capify

Your business must have a minimum of 1 years trading history. No sole traders.

Superfast lending. Receive your funds the following day

All credit profiles are considered. Loans for any business purpose

Easy application process. Get conditionally approved in just 2 minutes
Minimum Turnover
£120,000 p.a.

Available Amounts
£5,000 to £500,000

Available Terms
3 to 18 months

See Deal
Company details
- Capify loans are paid back in very small automated regular payment; either daily or weekly
- A fast and easy business funding alternative for SMEs
- Funds can be used for any business purpose, from managing cashflow through to improving technology
Eligibility Criteria
Lombard

Lombard offers a comprehensive range of asset finance solutions - specialising in business car finance

A simple finance solution with a credit decision in 24 hours for transactions up to £150,000

Security, guarantees or indemnities may be required. Product fees may apply. Finance is subject to status and is only available for business purposes
Minimum Turnover
No minimum

Available Amounts
£5,000 to £250,000

Available Terms
1 to 7 years

See Deal
Company details
- Lombard is one of the UK’s oldest and largest asset finance partners
- They have helped thousands of businesses invest in their future’s every day
- Lombard have won Best Leasing and Asset Finance Provider at the Business MoneyFacts Awards every year from 2009 to 2018
Eligibility Criteria
Previse

Previse Instant Advance is a fast cash flow facility, designed specifically to help businesses grow

Completely unsecured, no personal guarantees or security required

Available with a variety of short term lengths
Minimum Turnover
£250,000 p.a.

Available Amounts
£10,000 to £500,000

Available Terms
3, 6 or 9 months

See Deal
Company details
- Previse Instant Advance is a fast cash flow facility, designed specifically to help businesses grow
- Completely unsecured, no personal guarantees or security required
- Available with a variety of short term lengths
Eligibility Criteria
- Previse Instant Advance is a fast cash flow facility, designed specifically to help businesses grow
- Completely unsecured, no personal guarantees or security required
- Available with a variety of short term lengths

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