How much can I borrow with a business loan?
By Helm, Funding Specialist
- Borrowing limits range from £1,000 to over £2 million depending on the loan type
- Revenue is the most important factor for most lenders
- Secured loans offer higher amounts but require collateral
- Alternative lenders typically offer 1 to 1.5x monthly revenue
- Building a track record unlocks higher amounts over time
How much can I borrow? It is one of the first questions every business owner asks when considering a loan. The answer depends on the type of loan, your business revenue, your trading history, and your credit profile.
This guide breaks down typical borrowing limits by loan type and explains what you can do to access the maximum amount available.
Borrowing limits by loan type
Different types of business loan have very different borrowing ranges.
| Loan Type | Typical Range | Maximum | Based On |
|---|---|---|---|
| Bank term loan | £25,000 to £500,000 | £2m+ | Credit, revenue, assets |
| Merchant cash advance | £10,000 to £300,000 | £300,000 | Monthly card revenue |
| Unsecured business loan | £1,000 to £500,000 | £500,000 | Revenue and credit |
| Secured business loan | £10,000 to £2m+ | £2m+ | Asset value |
| Revenue-based finance | £10,000 to £300,000 | £300,000 | Monthly revenue |
| Start Up Loan | £500 to £25,000 | £25,000 per person | Business plan |
| Invoice finance | Up to 90% of invoices | Varies | Invoice value |
What determines your borrowing amount?
Several factors influence how much a lender will offer you.
- Monthly business revenue (card and/or total revenue)
- Length of trading history
- Industry and its perceived risk level
- Your personal and business credit scores
- Whether you have assets to offer as security
- Existing debts and financial commitments
- The lender's own criteria and risk appetite
How to maximise your borrowing amount
If you want to access the largest amount possible, consider these strategies.
- Apply when your revenue is at its peak
- Build a repayment track record with smaller advances first
- Grow your card transaction volume over time
- Keep your business finances well organised
- Reduce existing debts before applying
- Compare offers from multiple lenders
- Consider secured options if you have valuable assets
Should you borrow the maximum?
Just because you can borrow a certain amount does not mean you should. Borrowing more than you need increases your repayment burden and reduces your daily cash flow.
Calculate exactly how much you need for your specific purpose, add a small buffer for unexpected costs, and borrow that amount rather than the maximum available.
Can you increase your amount later?
Yes. Most lenders offer the ability to borrow more once you have repaid your initial loan. With merchant cash advances, top-ups are often available once you have repaid 50 to 70 percent of your current advance.
Your borrowing capacity generally increases over time as you build a repayment track record and grow your revenue.
Frequently asked questions
Can I borrow more than my annual revenue?
With secured loans, potentially yes, as the amount is based on asset value. With unsecured and revenue-based options, borrowing is typically capped at 1 to 1.5 times your monthly revenue.
Does my industry affect how much I can borrow?
Yes. Some industries are considered lower risk by lenders, which can lead to higher offers. Hospitality, retail, and healthcare typically receive strong offers.
Can I combine multiple loans to borrow more?
You can, but stacking multiple loans increases your total repayment burden. Make sure the combined repayments are manageable for your business.
Will a larger loan cost proportionally more?
Not necessarily. Some lenders offer better rates for larger advances because the fixed costs of processing are spread over a bigger amount.