Common funding needs in the hospitality sector
- Funding kitchen fit-out, bar equipment and refrigeration
- Building a buffer for off-season trading and quieter months
- Stock and beverage purchases ahead of peak periods
- Acquisition of new sites or leasehold assignments
- Refurbishment between leases or following landlord-required works
- Bridging cashflow between supplier payments and card settlements
Finance types that usually fit
Based on how UK lenders typically underwrite this sector, the following finance categories are the most common fit:
Merchant Cash Advance
Cash advance repaid as a share of card/POS/platform sales.
Asset Finance
Finance to buy/refinance equipment, vehicles or machinery.
Unsecured Business Loan
Term loan or credit line repaid through fixed instalments.
Commercial Mortgage
Long-term commercial property purchase/refinance funding.
Sector-specific eligibility blockers
- Recent closures, license issues or food hygiene problems
- Short remaining lease where lender wants security longer than lease term
- Single-site concentration risk for unsecured borrowing above £100k
- Card-sales volume insufficient for MCA underwriting
- Late-night license restrictions affecting some specialist lenders
How routing usually works in hospitality
For hospitality, routing depends heavily on use case and asset. Card-sale-led operators get matched first to MCA providers via their card processor. Fit-out and kitchen equipment go to asset finance, where lenders like Lombard and Propel have strong sector experience. Stable groups with multiple sites can apply for unsecured term loans from iwoca or Funding Circle. Acquiring a freehold pub or restaurant goes to commercial mortgage lenders, often via a bridging loan from Together or Hampshire Trust Bank where speed matters. Tenancy assignments are usually funded through unsecured loans plus asset finance for kit.
UK lenders active in hospitality
The lenders below publish criteria consistent with funding businesses in this sector. Final approval is always subject to lender underwriting.
Liberis
Business Cash Advance
- Amount
- £500–£1m; flexi up to £2m via partners
- Speed
- Minutes via partner
- Security / PG
- Not clearly disclosed
- Data confidence
- Medium
YouLend
Sales-based funding
- Amount
- Up to 2x monthly revenue
- Speed
- Offer <24h; funding ~48h
- Security / PG
- Not disclosed
- Data confidence
- Medium
SumUp
Cash Advance
- Amount
- £500–£100k
- Speed
- In-app offer
- Security / PG
- Not disclosed
- Data confidence
- Medium
Square
Square Loans
- Amount
- £100–£250k
- Speed
- 1–2 business days
- Security / PG
- Not disclosed
- Data confidence
- Medium
Lombard
Asset finance / HP
- Amount
- £25k+
- Speed
- Not disclosed
- Security / PG
- Security/guarantees may be required
- Data confidence
- Medium
Novuna Business Finance
Asset finance
- Amount
- Not disclosed
- Speed
- Not disclosed
- Security / PG
- Asset-backed
- Data confidence
- High
Allica Bank
Asset finance
- Amount
- £25k–£2.5m
- Speed
- Not disclosed
- Security / PG
- Asset-backed; up to 100% advance
- Data confidence
- High
Frequently asked questions
- Is merchant cash advance the right fit for a pub or restaurant?
- Often yes, if the venue takes a meaningful share of revenue on card and is on a supported card processor. The repayment as a percentage of daily sales matches the seasonal nature of hospitality cashflow. The cost is higher than a term loan, so use it for short-cycle needs.
- Can a new hospitality business get finance?
- Difficult for unsecured term lending in the first 6 months. Asset finance for new builds is possible with strong director PG and 20–30% deposit. Platform-native MCA from SumUp or Square is available to merchants with even short processing histories.
- How do lenders view leasehold vs freehold hospitality businesses?
- Freehold operators have stronger collateral and broader lender appetite. Leaseholders are still well-served by working capital and asset finance, but commercial mortgage and bridging are limited to the freehold owner of the property.
- Can I finance the purchase of an existing restaurant?
- Yes, via a combination of business acquisition finance (often a secured loan or commercial mortgage on the freehold), asset finance for the kit, and an MCA or unsecured facility for opening working capital. Most cases need a structured package, not a single product.
- What documents will a hospitality lender ask for?
- Standard: bank statements, accounts, ID. Plus typically: lease document or freehold title, card processor statements, food hygiene rating, premises license. Asset finance also wants a supplier invoice for the equipment.
Related use cases
Eligibility checks for this sector
Each finance type has its own eligibility signals. The pages below explain what UK lenders typically look at — criteria can change and final decisions are subject to lender underwriting.