UK SME finance comparisons
Side-by-side comparisons of UK SME finance products and named lenders. Each page sets out where one option usually fits, where the other does, and the shared trade-offs you should weigh before applying.
Eligibility guidance only - not financial advice, not a loan offer, not a guarantee of approval. Lendrly is not FCA-authorised and is not a credit broker.
- Comparison
Allica Bank vs Shawbrook
Allica Bank and Shawbrook are both UK challenger banks lending to established SMEs and commercial property clients, with a relationship-led model rather than a pure online flow. Allica focuses on the underserved mid-sized SME segment — commercial mortgages, asset finance and business savings — with a relationship manager structure. Shawbrook covers a broader specialist lending base, including commercial property, professional lending and asset finance, with a longer track record on larger transactions. The right fit depends on ticket size, property type and how relationship-led you want the process to be.
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Asset finance vs Unsecured business loan
Asset finance funds a specific tangible asset — a van, machine, server or piece of plant — with the asset itself acting as security. An unsecured business loan is a general-purpose lend repaid in fixed monthly instalments, sized to affordability rather than to a single item. For asset purchases, asset finance usually unlocks larger amounts at lower effective cost than an equivalent unsecured loan. For mixed-use working capital, an unsecured loan tends to be more flexible. The right route depends on what you are buying and whether the spend is concentrated on one identifiable asset.
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Bridging finance vs Commercial mortgage
Bridging finance is short-term property-secured lending, usually three to twenty-four months, priced as a monthly rate and used to move quickly on a purchase, refurb or auction. A commercial mortgage is long-term property finance, typically five to twenty-five years, priced as an annual rate and used to buy or refinance trading premises or investment property. Bridging needs a clear exit. A commercial mortgage needs evidenced affordability. The two often work together: bridge first, then refinance onto a mortgage.
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Business credit card vs Merchant cash advance
A business credit card is revolving credit for small operational spend — subscriptions, travel, supplier invoices — priced as a stated APR with a relatively low limit. A merchant cash advance is a lump-sum facility repaid as a percentage of daily card takings, sized to a multiple of recent turnover and priced as a factor rate. The card handles ongoing micro-spend cheaply if cleared monthly. The advance funds a single, larger working-capital need where card sales evidence sits in place of filed accounts.
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Equipment finance vs Equipment loan
Equipment finance is a form of asset finance: the lender funds a specific piece of equipment with the asset itself as security, structured as hire purchase or lease over its useful life. An equipment loan is an unsecured or lightly secured loan earmarked for buying equipment but assessed on general affordability rather than the asset. The finance route usually unlocks larger amounts at narrower pricing; the loan route is simpler, faster and keeps the equipment unencumbered. The right fit turns on how specific the spend is, how big the ticket is, and how much speed matters.
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Funding Circle vs iwoca
Funding Circle and iwoca are two of the most recognised UK SME lenders, both offering unsecured business loans with personal guarantees. Funding Circle leans towards larger, fixed-term loans for limited companies with at least a year of trading and predictable repayment. iwoca leans towards smaller, faster, more flexible facilities — including its revolving Flexi-Loan — and accepts newer businesses. The deciding factors tend to be ticket size, how you want to repay, and how much filed trading history you can show.
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Hire purchase vs Finance lease
Hire purchase and finance lease are the two main UK asset-finance routes for SMEs acquiring vehicles, plant or equipment. Hire purchase splits the asset cost into instalments with title passing once the final payment and option-to-purchase fee are paid; you own the asset at the end. A finance lease rents the asset over its useful life — the lessor retains legal title and you typically have continued-use, secondary-rental or sale-on-behalf options. The right choice turns on ownership, VAT cash flow and tax treatment.
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Invoice finance vs Business overdraft
Invoice finance releases cash tied up in unpaid B2B invoices, growing with your sales ledger and priced as a service fee plus interest on funds drawn. A business overdraft is a flexible bank facility you dip into as needed, priced as interest on the daily debit balance. Overdrafts are increasingly hard to obtain from UK high-street banks for newer or smaller businesses. Invoice finance is more widely available where you sell on credit terms, but involves more set-up and ongoing reporting.
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Invoice finance vs Asset finance
Invoice finance and asset finance both unlock cash without diluting equity, but they fund different parts of a UK SME's balance sheet. Invoice finance releases working capital tied up in unpaid B2B invoices, scaling with the sales ledger and repaid as customers settle. Asset finance funds the purchase or refinance of tangible items — vehicles, machinery, equipment — over a term matched to the asset's useful life. Many growing SMEs run both: invoice finance for cash flow, asset finance for capex.
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Islamic business finance vs Conventional business finance
Islamic business finance avoids riba (interest) by structuring the deal as an asset purchase, lease or partnership rather than a loan with interest. The customer pays an agreed mark-up, rent or profit share, not interest. Conventional business finance uses an interest-based structure — APR or factor rate — and a wider product range (unsecured loans, MCAs, revolving credit lines, invoice finance). UK Islamic finance is offered by a small number of FCA-authorised banks (Al Rayan, Gatehouse, BLME, ADIB UK) and specialist providers like Qardus. Provider choice is narrower and product range is more limited, but the structure suits SMEs that want a Sharia-compliant route or prefer the transparency of a single agreed mark-up over variable interest. Lendrly maps published criteria on both sides so the right structural fit can be chosen before applying.
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iwoca vs Funding Circle
iwoca and Funding Circle are two of the most established UK SME lenders, both offering unsecured business loans with personal guarantees. iwoca leans towards smaller, faster, more flexible facilities — including a revolving credit line — and accepts younger businesses. Funding Circle focuses on larger, fixed-term loans for limited companies with at least a year of trading. Decision speed, amount range and repayment structure differ meaningfully, so the better fit depends on your stage, ticket size and how you want to repay.
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iwoca vs Capify
iwoca and Capify are both UK SME lenders, but they sit in different parts of the working-capital market. iwoca offers unsecured business loans and a revolving Flexi-Loan, sized to affordability and repaid in monthly instalments. Capify is best known for merchant cash advances repaid as a share of card takings, plus short-term business loans pitched at smaller, card-heavy operators. The deciding factor tends to be whether your revenue is card-led, how predictable your monthly cash flow is, and how long you have been trading.
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Merchant cash advance vs Unsecured business loan
A merchant cash advance is repaid as a percentage of daily card takings, priced as a fixed factor rate, and usually settled within days for card-heavy businesses. An unsecured business loan is repaid in fixed monthly instalments at a stated APR over a defined term, sized to affordability and trading history. The advance suits short-term, sales-linked needs; the loan suits planned spend you can budget against. Neither is FCA-regulated consumer credit, and both are subject to lender underwriting.
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Revenue-based finance vs Merchant cash advance
Revenue-based finance and merchant cash advances share a family resemblance — both repay as a share of revenue rather than a fixed monthly instalment — but the underwriting and target customer differ. Revenue-based finance funds online-led businesses (e-commerce, SaaS, marketplace sellers) against platform data and a wider revenue base. A merchant cash advance targets card-heavy in-person merchants and prices a fixed factor rate against future card receipts. Both suit short-term, sales-linked needs, but the right fit depends on how you take payment and how predictable your revenue is.
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Secured business loan vs Unsecured business loan
Secured and unsecured business loans solve the same problem — funding business spend over a fixed term — but trade speed and accessibility against amount and price. A secured loan takes a legal charge over property, plant or another tangible asset, unlocking larger amounts at narrower pricing. An unsecured loan relies on affordability, trading history and a personal guarantee, with smaller amounts available more quickly and with less legal work. Many UK SMEs use unsecured loans for working capital and secured loans for one-off larger projects or refinance.
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Short-term business loan vs Merchant cash advance
A short-term business loan provides a lump sum repaid in fixed weekly or monthly instalments over three to twenty-four months, priced as a stated APR. A merchant cash advance provides a lump sum repaid as a percentage of daily card takings until a fixed factor-rate total is settled. The short-term loan suits businesses that can budget against a known instalment; the advance suits card-heavy traders who want repayments to flex with sales. They overlap heavily on speed, so the deciding factors tend to be repayment style and how revenue is taken.
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Starling Bank vs Tide
Starling Bank and Tide are both UK digital business banking platforms, but they take different routes to SME credit. Starling is a fully licensed UK bank offering its own business loans, overdrafts and asset-finance arrangements alongside the current account. Tide is a banking platform — current accounts are provided in partnership with regulated providers — and credit products are surfaced through partner lenders rather than originated on Tide's balance sheet. The choice tends to come down to whether you want credit decisions made by the bank itself or by partner lenders introduced through the app.
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Working capital loan vs Business line of credit
A working capital loan is a lump-sum facility drawn once and repaid in fixed instalments over a short to medium term — typically used for a single, known cash-flow need. A business line of credit is a revolving facility you draw on as needed, repay, and redraw, paying interest only on the outstanding balance. The loan suits a defined spend you can budget against; the line suits unpredictable, recurring cash-flow gaps. The right fit depends on how steady your need is and how disciplined you can be with revolving credit.
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YouLend vs Liberis
YouLend and Liberis are two of the most active providers of revenue-based finance and merchant cash advances to UK SMEs, both operating largely through embedded partnerships with payment processors, marketplaces and platforms. YouLend powers cash advances inside partners like eBay, Just Eat and several payment platforms, sized to a multiple of recent revenue. Liberis offers business cash advances directly and through partners across payments, e-commerce and SaaS, with strong UK SME coverage and a long track record. Both are unregulated business-purpose facilities subject to lender underwriting.
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Important — educational guidance only
- Not regulated by the FCA and not a credit broker.
- Not financial, legal or tax advice.
- Not a loan offer and not a guarantee of approval.
- Subject to lender underwriting — criteria can change.
Lendrly provides general eligibility guidance only. It is not financial advice, a loan offer, or a guarantee of approval. Provider criteria can change and final approval is subject to lender underwriting, affordability checks, credit assessment, and documentation. Lendrly is not a regulated credit broker; we do not submit applications on your behalf.