Understanding short terms business loans (terms of less than 12 months)


It’s never been harder for UK SMEs to obtain short term business loans from traditional sources. With banks less willing to lend to small businesses than they were before the recession, it can be challenging for SMEs to secure short term funding, even if they’re generating a healthy revenue.



Article Contents

  1. What is a short term business loan?
  2. Why a short term business loan?
  3. Advantages to short term business loans
  4. Disadvantages to short-term business loans
  5. Applying for a short term business loan.
  6. Short term business loan calculator



What is a short term business loan?


Business Owner


Short-term business loans are not that different from personal loans. You’ll receive an advance in funds for your business which will need to be repaid with interest within a specific period of time. With short term business loans the repayment period tends to be less than 9-12 months.



Why a short term business loan?


Business Meeting


Our short term business loans are available to companies in almost any industry and can be used for practically any purpose.


Maybe you need:

• to raise working capital to cover payments or purchases
• to cover payroll
• to fill gaps while you’re waiting for suppliers to pay
• to even out your cash flow if your business has busier, then quieter, periods



Advantages to short term business loans


Laptop Coffee


The biggest advantage of opting for a short-term business loan is that your business will only have to make repayments for a limited period of time. This means the loan won’t affect your business finances in the long-term and can be dealt with quickly and easily.

We run a fast and sensible system for loan applications, requiring less information for you to fill out than if you were applying for a loan over a longer term. We process applications fast so you can get your hands on the funds you need quickly.



Disadvantages to short-term business loans


Business Meeting


Choosing to take out a short-term business loan may mean you’ll be able to pay off your balance quickly, but bear in mind that your repayments are likely to be higher than if you opted for a medium or long-term loan. Loan terms are often 90 to 120 days. Interest rates are also often notably higher with short-term borrowing, so it’s worth making sure you get a good deal. Use our calculator below to get our best rates.



Applying for a short term business loan.


Business Owner


To apply for short business loans your company will need to have been trading for six months. And you’ll need to be registered as a limited company. If you’re working as a sole trader or other company structure, and accept card payments from your customers, then we can still help. Find out more about our merchant cash advance route.

Our finance arrangements offer anything from £5,000 to £500,000 with flexible terms and a fixed cost. Use the calculator below to find out how we can help your business grow.



Short term business loan calculator


Our simple calculator can give you short term small business loans estimates in seconds. Enter your details now for a fast and accurate quote.





Raise £3,500 to over £150,000 for your small business

Capify offers flexible finance with simple repayments. There are no massive monthly Direct Debits to think about, just small manageable payments that are easy to keep track of.

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