Short term business loans are a type of bank or alternative lead funding that allows a repayment period of up to 12 months. The funding product is ideal for businesses in need of a quick injection of cash.
Perhaps you have considered applying for a secured bank loan. The traditional bank loan is subject to long turnaround times. They may also require you or the business to provide security by way of a charge against your property or a second person as a guarantor.
Eligibility for a short-term business loan your business needs to have been running and actively trading for a minimum of 18 months, a minimum turn-over of at least £80,000 on a yearly basis is also required.
What is a short-term business loan?
A short-term business loans are designed for businesses they require an injection of cash to cover working capital. PDQ Funding offer an alternative short term lending, businesses repayments are not set in stone, with terms up-to 18 months.
Alternative type of finance loans can help businesses plan ahead. They are confident if they do not make a sale then no repayment is due. If you are having a tough month you’ll pay back a smaller amount. The business maybe having a fantastic month so you will be able to pay off the PDQ Loan in a shorter period of time. Short term business loans are popular options for many small and medium-sized businesses. They allow the business to stay in complete control of your companies money. This means you can have the confidence you need to manage your business finances on a daily basis.
Business owners can usually get cash injection loans of between £5,000 and £200,000, the actual amount that is available to borrow will be dependent on the following:
- Your business’ financial health
- The lenders’ criteria you wish to borrow from
- What the funds are to be used on and the reasons behind it.
Interest rates can vary widely depending on the lender, your business sector and if the interest is to be rolled up yearly. Rates vary between 5% to 10%, providers generally charge interest on the higher end of the scale.
Choose the right loan for your business
This is everything you need to consider before deciding which short-term business finance is right for your business:
- The amount you want to borrow: The amount you want to borrow will ultimately affect the amount of interest you’ll be paying in the long run. If you borrow a large amount that takes you a long time to pay back, you’ll find yourself paying more interest. So, only borrow as much as you need to.
- The interest rates: Be aware of what the interest rate is you’re being offered before taking out a short term business loan. The more information you have the better. This is because it’ll be more beneficial to you if you can work out how much interest you’ll have to pay, prior to taking the loan out.
- The actual length of the loan: Knowing approximately how long your short term loan will last is important information to consider. Be aware of what amount of money you’ll realistically need and and contemplate how long it’ll take you to pay back. Are you getting the right amount of money for the things you need your business to achieve in the near future? Does your short term loan help to set your business up for the future? These are all questions you need to ask yourself.
- What application fees come into play: Be aware of application fees you’ll potentially have to pay. This will obviously add to the total amount of your loan repayments, so make sure you have the right amount of funding to cover your entire repayment charges before taking out a loan.
Advantages of short term business loans:
- One fixed monthly repayments cost all agreed upfront
- It’s unsecured, meaning no personal guarantees – no risk to a charge on your home.
- Payback is done seamlessly all via your PDQ Card Payment Machine.
- 90% of applications submitted are approved
- The application process is so simple and and hassle free
- Cash Advance Funding is available between £5,000 – £200,000
- Penalty and additional cost free, with no hidden fees.
Disadvantages of short-term business loans:
The number of downsides when applying for a short-term loan over a long-term business loan including:
- Repayments are higher higher compared to borrowing the same amount over a longer term
- Interest rates are charged at a higher rate with short term finance
- Lenders may charge an early repayment fee if you pay off your loan before the end of your loan term.
Difference Between Short Term & Long Term Business Loans
The difference between short term and long term business loans are the term time that is required to repay the loan. A long-term business loan involves multi-year repayment terms following a detailed application process. Short-term loans for businesses provide quick access to capital, sometimes in as little as 24 hours.
Whether it’s working capital or some other type of small business loan, the amount of money you need to borrow is probably your top priority when looking at loans. After all, if you don’t borrow enough, you’ll end up needing another loan. Borrow too much, and you may not be able to pay it back on time, regardless of it’s a long-term loan vs. short-term loan.
Short term business loans have stricter eligibility requirements. Business all have periods of high and low sales and in the low months you still owe the full monthly repayment. This is true for businesses where card transactions vary from in line with season sales, a business cash advance can be the perfect funding solution. The main benefit is that you only repay when a sale is made. Because repayments work inline with your sales, so the more the company sells the higher the percentage is paid back, this means you will not need to worry about being short on cash at the end of the month. Business cash advances are a safer alternative to business funding because there is no such thing as a missed payment.
Unsecured short term loans tend not to be authorised and regulated by the financial conduct authority.
Short-term business loan with poor credit history
It is true that it can be far more difficult to obtain finance if you have a negative credit history. Our funding methods can come into play in a rather helpful way in these types of situations however, as we offer unsecured funding, which doesn’t require a credit check of applicants. This is why our alternative business finance methods are always increasing in popularity.
You can find yourself with a poor credit history due to a wide range of differing reasons. For instance, your clients may have not paid you on time for a service, or you may have made some miscalculations of your own in the past; we do not believe this should tarnish your chances of success forevermore. If you are a long-term business owner, the chances are you will have had many ups and downs, so having a negative history of credit can become hard to avoid in certain situations.
You’ll often find that your poor credit score can be rescued and turned into something much more positive by carrying out a few simple steps. You should attempt to do this before submitting an application for a loan, in order to give you the best chance of being successful.
However, with all of that being said, if you find it extremely difficult to change your credit score for the better and you need a short-term business loan asap, you should still apply with PDQ Funding today.
As we have already mentioned, our loans are unsecure, which means even with an unfavourable history of credit, you will likely still find yourself being accepted and receiving the financial boost you desire.
Reasons to apply for a Short Term Business Loan UK
Small businesses in the UK are the back bone of the economy, we understand the pressure of managing cash flow on a daily basis. If your small business is in need of an alternative business loan, the traditional first place to look is the hight street bank. Alternative lender have entered the market over the last few years with alternative funding solutions like Business Cash Advance.
PDQ Funding offer short term business loans for positive cash flow with funding from £5,000 to £200,000 within 48 hours. We was established to help business with alternative lead funding such as yours to reach its goals by offering business finance without the hassle. Our commitment to business has help over 1,000 business gain funding via their PDQ Card Payment Terminals. This alternative lending solution sets us apart from other lenders.
- A UK based Limited Company, Partnerships or Sole Traders are also welcome.
- I have a been trading for six months or longer
- My minimum turnover of £5,000 per month is required though the business PDQ Machine each month.
Apply for a Short Term Business Loan
Applying for PDQ Finance is so simple and very fast. Directors of a limited company are always in a hurry and we understand that cash flow is important to a business.
Follow these easy steps to get a short term funding with us:
Click on the application page. To ensure we get all the information that is needed, we will ask for the following information about your business:
- Your business name
- The number of years you have traded for
- Average monthly card sales
- The amount you are looking to lend
You will then be directed to the next step, where you will be required to give the following information:
- Title, first name and surname
- Company Address if registered in England and Wales
- Company number & registered office
- Your position within the business
- Best email and telephone number to get hold of you on
Click to accept the terms and conditions and click ‘get my quote’. From here your application will be processed and reviewed by our business manager.
One of our account managers will be in touch by phone or email to discuss the terms of your loan and the loan amount.
After carefully reading through the terms of agreement, please sign the relevant documentation and return it to the lender
The questions you’ll have
Can I apply for a business loan in my own name?
Yes, you can apply for a business loan in your own name, as long as you’re the registered owner of the company that the loan will be used to help fund.
Are there payment holidays with a short term business loan?
In most cases there will not be any payment holidays, no. Depending on where you apply for a loan this could potentially slightly differ, but it’s doubtful anyone will offer this to you with a short-term loan.
Do I need a business bank account to apply for a business loan?
In most cases providers will expect you to have a business bank account, yes. Again, this could differ from lender to lender, but if you’re expecting to acquire a business loan over any time period, you should have a business bank account for the funds to be paid into. It will also give your application an authoritative boost.
How will a short term loan benefit my business?
Short term loans come packed with many benefits for the consumer. Not only will you pay less interest because your loan doesn’t last last for as long as would with a more extensive term loan, but approval also tends to be much shorter when compared with longer termed loans. Having a shorter loan period also means that your business won’t be paying it off for an overly extended amount of time. This is clearly beneficial to the company you’re attempting to get the loan for as it won’t be in a long-winded financial struggle. You’ll also have access to your funds quickly, after the application process has been deemed a success. In most cases funds will be available within 1-2 days after applying, meaning that you can use your newly found funding to help your business achieves what it needs to with its next step towards growth.