Compare ^{Private Debt Finance} For £400k Business Funding

Direct lending involves private institutions supplying capital directly to businesses that demonstrate solid financial records and at least two years’ trading. The application can take two to four weeks, and interest rates typically range from 8% to 20%, depending on risk. This route suits businesses in sectors like manufacturing or technology that require funds for capital expenditure, debt refinancing, or expansion, and supports those with significant asset bases and high growth potential.

Mezzanine finance combines debt and equity features, making it flexible for businesses pursuing acquisitions, shareholder buyouts, or expansion. It usually involves in-depth assessment, and decisions may take four to six weeks. Interest rates range from 10% to 25% and may include equity options. Sectors like retail, property development, and industrial firms often use mezzanine solutions either to support growth or to structure complex capital needs.

With asset-based lending, businesses access finance secured against assets such as inventory, property, or invoices. The process includes valuing business assets and establishing a revolving credit facility, with rates typically between 5% and 15%. Decision times can be quick, from one to three weeks, and this option works well for sectors like wholesale, logistics, or manufacturing seeking to unlock liquidity for cash flow or operational changes.