How to secure business finance

8 Apr 2021

April 12 – the date that stage 2 of the lockdown roadmap comes into play – is when non-essential shops can reopen and resume trading in person. Pubs can serve customers seated outdoors and haircuts can finally resume. Businesses have been working around the clock to get ready, and many are now looking ahead to how they can prepare for stage 3.


We recently published a guide for businesses that contains some practical tips for reopening on 12 April. While some of the information will also apply to stage 3, such as understanding the rules around exactly how you can reopen further, this article will focus more specifically on how alternative finance can help you bolster your business ahead of the May date. 

But first, here’s a quick recap on what’s due to change on 17 May at the earliest, pending a Government review of the rules nearer to the time. 

Stage three rules (no earlier than 17 May):

  • The majority of outdoor mixing rules will be relaxed; up to 30 people can meet in gardens or parks.

  • Up to six people (or two households) can mix indoors.

  • Indoor venues can reopen, including the inside of pubs and restaurants, hotels and B&Bs, play centres, cinemas and museums. Pubs and hospitality venues must still adhere to the rule of six for indoor guests.

  • Adult indoor group sports and exercise classes can resume.

  • Hotels, hostels and B&Bs can reopen. International holiday travel could resume on this date too, pending a review. 

  • Indoor sports venues can welcome back up to 1,000 spectators or half of their capacity (whichever is fewer), and up to 4,000 spectators outdoors or half their capacity (whichever is fewer). Big football stadiums can admit up to 10,000 people spread out or a quarter of their capacity (again, whichever is fewer).

  • Up to 30 people can attend weddings, and celebrations such as christenings and bar mitzvahs will be allowed to resume. 

Why secure business finance now?

Whether you’ve got growth plans in the pipeline or anticipate needing a working capital boost prior to reopening, there are plenty of finance options out there to take advantage of. Gone are the days of having to rely on your business bank for finance. Fortunately, there’s a growing number of alternative lenders and products out there waiting to be tapped into.

We expect that businesses operating in the retail, hospitality, arts and leisure sectors will be exploring their finance options at the moment. But many others are likely to be too, from tech startups to charities and nonprofits. You might be looking for business finance if:

  • You’re planning a refurbishment ahead of reopening

  • You need to purchase new equipment, machinery or vehicles

  • You require a quick cash injection

  • You’re looking to hire new staff ahead of opening

  • You want to buy new stock

  • You need finance to meet existing operational costs

  • You need a short-term bridging loan to get you from A to B

This list is by no means exhaustive, and there’s a finance type out there for every business purpose. Let’s take a couple of business finance sources available today.

1. Alternative finance (Alt-Fi)

Even if you’re eligible for the Recovery Loan Scheme, you might still be able to find an alternative type of business finance that has better terms for you. That’s why it’s always worth exploring your options. At Funding Options, we’ve made this a lot easier for businesses by combining our business finance expertise with innovative technology.

In just a few easy steps, you can find out what finance you could be eligible for in the run up to 17 May. Just let us know how much finance you’re looking for, what you need it for and how quickly, and our algorithm will do the legwork. 

Once you’ve chosen a suitable finance option, we’ll help you navigate the process, from the application process until the money hits your business bank account. Alternative finance products to explore include:

Revolving credit facility - provides access to finance on a “tap in, tap out” basis.

Flexible bridging loan - short-term finance designed to get your business from A to B.

Asset finance - let’s you spread the cost of an essential business purchase.

Invoice finance -  a way to borrow money based on what your clients owe.

eCommerce finance - covers working capital finance, trade finance and fast business loans.

Merchant cash advance - allows you to borrow money and pay it back through your customer card payments.


2. Recovery loan scheme (RLS)

The Recovery Loan Scheme launched on 6 April, at the start of the new tax year. Anyone whose business has been impacted by the coronavirus pandemic and who can afford to take on additional debt finance can apply. Unlike the CBILS, there’s no turnover restriction. 

The RLS is currently set to run until 31 December 2021. A variety of accredited lenders have signed up to the scheme, including high street banks and alternative lenders. As with the CBILS, you won’t have to provide a personal guarantee for facilities under £250,000. You will, however, be required  to cover all interest payments from day one. 

Loan types available under the RLS include:

Term loans – £25,001 to £10 million, terms from three months up to six years.

Overdrafts – £25,001 to £10 million, terms from three months up to three years.

Asset finance – £1,000 to £10 million, terms from three months up to six years.

Invoice finance – £1,000 to £10 million, terms from three months up to three years.

It’s important to note that RLS lenders are still being accredited, and whilst the RLS may be a good option for some, it’s certainly not the only option out there. It’s likely that the majority of lenders won't be actively lending until early May. That’s why it’s also worth exploring the alternative finance options mentioned above. 

Looking ahead to stage 4 of the roadmap…

If all goes to plan, legal limits on mixing are scheduled to be removed on 21 June at the earliest. This is also when we anticipate that nightclubs can reopen and large events can take place. It’s likely that some form of social distancing will remain, the details of which will be announced in a separate review. 

We’ll continue to be there for businesses who need us through June and into Q3, Q4 and beyond. We processed more than £760M in CBILS loans last financial year and we’ll also be providing businesses with access to the Recovery Loan Scheme.

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Thomas Boyd
Thomas Boyd

Head of Commercial

Thomas Boyd is the Head of Commercial at Funding Options. Thomas started his career in the finance sector at LendingCrowd. His work over the past five years has focused on supporting the vibrant and growing community of SMEs across the UK.

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