The alternatives we recommend you check before applying
The operator's own product page at credicorp.co.uk/business-loans lists nine alternatives a director should consider before applying for a Credicorp loan. The reasoning is plain: Credicorp's products are useful for a specific job — a small, short, urgent business-credit need with no personal guarantee — and for most other needs, there is a cheaper option. This piece is the longer-form version of why each one is on the list.
1. A business overdraft
A pre-arranged overdraft on a business current account. Typically priced at 6–15% a year (per the operator's own framing). If your company has one set up — or your bank will set one up — an overdraft is almost always cheaper than a Credicorp loan for any short-term cash-flow gap. The trade-off: most UK high-street banks don't offer business overdrafts to very small or very new companies, and the application is slower than a Credicorp application.
2. A business credit card
Revolving credit on a card account. Typically priced at 12–25% a year if you pay in full each month or pay only the minimum on a part-amortising balance. Useful for inventory purchases, supplier deposits and trade with major-brand counterparties. Not useful when you need cash in the business bank account.
3. Invoice finance
Selling (factoring) or borrowing against (invoice discounting) unpaid invoices. The lender typically advances 70–90% of the invoice within a day, collects the invoice from the buyer, and pays the rest minus a fee on receipt. Good for businesses with large invoices to creditworthy buyers and a slow payment cycle. Not useful if you don't yet have unpaid invoices to use as collateral.
4. Asset finance
Financing against business assets — equipment, vans, machinery. Two main flavours: hire-purchase (you own at the end) and finance lease (you don't). Useful for capital purchases. Not useful for working capital.
5. A grant
Non-repayable money. UK government and devolved-government grant schemes change frequently; the gov.uk Business Finance Support Finder is the canonical place to start. Eligibility is usually narrow (sector, region, R&D, decarbonisation, etc.), but if you are eligible, a grant beats every other form of finance.
6. A Start Up Loan
A British Business Bank scheme for new companies (typically under three years old). Personal loan to the founder, fixed rate, repayable over 1–5 years. Up to £25,000. Available via partners such as startuploans.co.uk. Good for early-stage businesses where the funding need is larger than Credicorp can do and the founder is willing to borrow personally. Note: a Start Up Loan is a personal loan, not a body-corporate loan; the founder is on the agreement.
7. A larger SME loan from a mainstream lender
If you need £5,000 or more, the operator recommends checking mainstream UK SME lenders first. The three the operator names by example are:
- iwoca — up to £1m; terms 1–5 years; representative APR around 49%; UK Ltd and LLP borrowers; FCA-registered for payment services (not for consumer credit).
- Cubefunder — small-business loans up to ~£100,000; short to mid terms.
- Funding Circle — up to £500,000; 6 months to 6 years; marketplace lender backed by institutional capital.
Larger SME loans almost always require a personal guarantee, especially under £100,000. That's a real cost to weigh up — see our explainer on personal guarantees.
8. A director's loan
You lend money from your own savings into the company. Properly documented (date, amount, interest rate if any, repayment terms), it's a clean and cheap way to fund a short-term gap if you have the personal savings to spare. The HMRC rules for director's loans are specific — interest, benefit-in-kind treatment if interest-free, the s.455 corporation-tax charge if the loan goes the other way (company to director) and isn't repaid within nine months. Worth a quick conversation with the company's accountant.
9. Asking a customer to pay early
Sometimes the cheapest move of all. A polite "we have a cash-flow gap this week, would early settlement of invoice N save us both time" with a small discount on offer (1–2% off for paying ten days early) is a faster solve than any lender, and the cost (the discount) is usually less than a short-term loan would charge.
When Credicorp is the right answer
The honest answer from the operator's own product page is: "You need a small amount in the company account in the next few hours, you can repay within a few weeks, and you do not want a personal guarantee on your home. If that is you, we are built to move quickly. If it is not, almost any option above will cost you less."
In other words: a Credicorp loan is right for the specific intersection of (small, short, urgent, no PG). Everything else has a cheaper route.