How Much Can You Borrow with an Unsecured Business Loan?

When you’re running or growing a business, cash flow gaps and sudden expenses can be a headache. If you’re looking for quick access to finance without risking your assets, an unsecured business loan may be the answer. But one key question likely pops into your mind straight away:

How much can I actually borrow with an unsecured loan?

Let’s explore what dictates that figure and how much you might be able to access.

What does ‘unsecured’ mean in this context?

An unsecured business loan means there’s no collateral, no need to pledge property or other valuable assets. Instead, lenders focus on the strength of your business and your ability to repay the debt .

Because there’s no asset tied to the loan, lenders take on more risk and compensate with higher interest rates compared to secured options .

How high can you go? Loan amount ranges

The exact amount you can borrow depends on factors like:

• Business turnover and profitability
• How long you’ve been trading
• Your credit history
• Existing debt or financial commitments

According to Rosewood Finance, unsecured business loan amounts typically range from £5,000 to £250,000, with interest rates starting at around 6%. That starting rate is competitive for borrowers with a solid financial profile.

Factors that influence the loan amount

1. Creditworthiness
   • Lenders assess your and your business’s credit score.
   • A strong credit profile can lead to larger loan offers.
2. Annual turnover & profit
   • Higher turnover demonstrates capacity to repay the loan.
   • Regular profits strengthen your case.
3. Time in business
   • New ventures might only get smaller loan amounts.
   • Established companies with a few years of trading tend to qualify for more.
4. Existing financial commitments
   • Lenders check how much you already owe.
   • High liabilities could limit borrowing capacity.
5. Purpose of the loan
   • A clear, constructive business purpose (e.g. purchasing equipment, marketing investment) can support a higher borrowing limit.

Why borrow unsecured?

• No asset risk: Your property or equipment isn’t at risk.
• Fast approval: With no need for valuations, the funds can land quicker.
• More suitable for smaller amounts: Ideal when you need between £5k–£250k without asset collateral.

That said, because of the lack of security, interest rates will be higher than those for mortgages or secured loans.

How to assess what you’re eligible for

1. Ask lenders for indicative quotes
   Many will provide preliminary info based on turnover and credit history.
2. Prepare financial info
   Have your annual returns, bank statements, and profit & loss data ready for quick assessment.
3. Compare providers
   Check rates, maximum loan limits, fees, and repayment terms from different lenders, including
   • Traditional banks
   • Challenger banks
   • Online lenders
4. Be realistic
   Borrow only what you need to avoid unnecessary interest payments.

Example: Borrowing £50,000

Let’s say you’re a small retail chain with:

• £600k annual turnover
• Trading for 4 years
• Clean credit history

You could be eligible for an unsecured loan between £25,000 and £100,000, perhaps getting:

• £50,000 over 5 years
• At around 6–8% interest

Monthly repayments would be manageable (around £1,000–£1,200), but be sure to factor in total interest costs and any arrangement or early repayment fees.

Final thoughts

With unsecured business loans in the UK, expect to borrow from £5,000 to £250,000, depending on business history, turnover, and creditworthiness. The starting interest at around 6% is competitive, especially when you need fast, collateral-free access to funds .

Key takeaways:

• Understand your eligibility by checking financials and credit history.
• Shop around for the best deal in terms of rate, length, fees, and monthly repayments.
• Borrow only what’s necessary, keeping future repayments realistic.