Unsecured business funding in the UK: your options explained
By Helm, Funding Specialists
- Unsecured funding means no property, equipment, or personal assets are at risk.
- Options include merchant cash advances, unsecured business loans, and revenue-based finance.
- MCAs are the fastest unsecured option, often funding within 24 to 48 hours.
- Eligibility for unsecured funding depends on revenue history rather than assets.
Many business owners hesitate to seek funding because they do not want to risk personal assets or business property. Unsecured funding removes that barrier by providing capital without requiring collateral.
This guide covers the main unsecured funding options available in the UK, how they work, and which might be the best fit for your situation.
What does unsecured funding mean?
Unsecured funding is any form of business finance that does not require you to pledge assets as security. If you cannot repay, the provider cannot automatically seize your property, equipment, or personal belongings.
This is in contrast to secured funding, where a specific asset (such as commercial property or a vehicle) is tied to the agreement. If the borrower defaults, the lender can claim that asset.
Unsecured funding options compared
Here is how the main unsecured funding products compare for UK businesses.
| Feature | Merchant Cash Advance | Unsecured Business Loan | Revenue-Based Finance |
|---|---|---|---|
| Collateral required | No | No | No |
| Repayment structure | % of card sales | Fixed monthly | % of revenue |
| Speed of funding | 24 to 48 hours | 1 to 4 weeks | 1 to 2 weeks |
| Credit check impact | Soft check only | Hard check | Varies |
| Best for | Card-processing businesses | Established businesses | Subscription/recurring revenue |
| Typical amounts | £5k to £500k | £5k to £500k | £10k to £1m |
Merchant cash advances
An MCA provides a lump sum repaid through a percentage of daily card transactions. It is the fastest unsecured option and does not require a strong credit score. The total cost is fixed upfront with no compounding charges.
MCAs are ideal for retail, hospitality, and service businesses that process regular card payments.
Unsecured business loans
An unsecured business loan provides a fixed amount repaid in regular instalments over a set period. While no collateral is needed, providers typically require a strong credit history and may ask for a personal guarantee.
These loans suit businesses with predictable revenue and a solid credit profile. The application process is usually longer than an MCA.
Revenue-based finance
Revenue-based finance is similar to an MCA but uses total revenue (not just card sales) as the basis for repayment. A percentage of monthly revenue goes towards repayment, making it suitable for online businesses, SaaS companies, and subscription-based models.
How to qualify for unsecured funding
Because there is no collateral to fall back on, unsecured funding providers assess risk in other ways:
- Consistent revenue or card transaction history
- A minimum trading period, usually three to twelve months
- Stable or growing sales trends
- No active insolvency proceedings
Is unsecured funding more expensive?
Unsecured funding can carry higher costs than secured alternatives because the provider takes on more risk. However, many business owners prefer paying a slightly higher cost to avoid putting personal or business assets on the line.
With an MCA, the total cost is fixed and transparent. You know exactly what you will repay before you accept the offer, which makes budgeting straightforward.
Frequently asked questions
What is the easiest unsecured funding to get?
A merchant cash advance is typically the easiest unsecured funding to access. Approval is based on card sales rather than credit score, and funding can arrive within 24 to 48 hours.
Do unsecured loans require a personal guarantee?
Some unsecured loans do require a personal guarantee, which means you are personally liable even though no specific asset is pledged. MCAs from providers like Helm do not require a personal guarantee.
Can I get unsecured funding with bad credit?
Yes. Merchant cash advances and some revenue-based finance products focus on your business revenue rather than your credit score. If your business generates consistent income, you may qualify regardless of your personal credit history.
How much unsecured funding can I get?
This depends on the product and your revenue. MCAs typically offer between £10,000 and £500,000 based on your monthly card turnover. Unsecured loans and revenue-based finance can go higher for established businesses.