How to fund your business without the bank saying no

A healthy business gets declined by its bank most days of the week in Britain. Not because the business is risky — because the loan doesn't fit the box the branch is holding. The manager doesn't have a product for a £40k van, a 60-day invoice gap, or a yard the owner wants to buy. So the answer is no, and the owner stops asking.

That's the quiet fact of SME lending: the high street sells its own shelf; a broker shows you the whole market. Specialist lenders have grown precisely because the banks stepped back — and most business owners have never heard of them. Here's the map.

1. Working capital — cash for the next six months

Money to bridge the gap between paying for work and getting paid for it: a big order, a deposit on materials, a slow month. Secured against the business or assets, or unsecured for stronger companies. From around £10,000, decisions in days. This is the route most owners should look at first because it's fast and flexible.

2. Asset finance — the kit pays for itself

Vans, trucks, plant, machinery, production lines. The asset itself is the security, which is why the rate is sensible and your house stays out of the conversation. Costs spread over one to seven years. If the machine earns more than the monthly payment, the maths answers itself.

3. Invoice finance — your customers' 60-day terms, gone

Customers pay in 60-90 days; you owe wages on Friday. Invoice finance releases the money tied in unpaid invoices within 24 hours. It's older than most people think, widely used, and — used properly — one of the cheapest forms of growth funding there is.

4. Commercial mortgages — buy the premises

Renting pays the landlord's mortgage. A commercial mortgage pays yours, at rates that often sit close to, or below, what the same building would cost to lease. Up to 75% of the value, terms from 3 to 25 years. Works for owner-occupied sites and investment property alike.

The one question every lender asks first

Not "what's your credit score". It's: "how does this get repaid?" Show a clear source — the contract, the invoice, the asset's earning power, the accounts — and you're most of the way there. Applications fail on vague purposes far more than on bad credit.

What to check before you apply

• Do you need speed (days) or the cheapest rate over 10 years? Different products, different lenders.
• What can stand as security — equipment, invoices, premises — without touching your home?
• Total cost over the term, not just the headline rate. Ask for it in pounds.
• Can you exit early without a penalty that eats the benefit?

Henry Romanenko runs BridgFunder London, a credit broker with whole-of-market access to 300+ specialist lenders. If your bank's terms are already sharp, he'll tell you so and leave you to it. Call 020 3535 6406 or send one line about what you're funding.