Lenders with lowest interest rate business loans
For UK franchise buyers and operators, this guide compares loan periods and amounts, APRs, and terms across leading providers, with a focus on eligibility and fit. Amounts that could not be verified are left blank, prices accurate as of 2026-01-28.
Funding Agent is focused on providing a straightforward comparison service for UK SMEs seeking various business finance options. It typically suits businesses looking for quick eligibility checks and simplified application processes. The platform offers flexible access across multiple product types without demanding collateral and supports a range of repayment options.
Loan Details
- Min Amount: £10,000
- Max Amount: £1,000,000
- Min APR: 4%
- Max APR: 20%
- Loan Duration: 3–60 months ⌛
Services & Industries
- Finance Types: Unsecured business loans, MCA Loans, Working capital
- Industries: UK SME's
Pros
- fastest and easiest application process
- No collateral required
Cons
- lower track record, only trading 1 year
Barclays provides a broad range of bank business loans with competitive rates and flexible terms. Its products primarily suit franchise buyers and established SMEs requiring secured or unsecured financing. The lender offers adaptable repayment schedules and access to multiple loan types, often requiring traditional credit assessments and potential security.
Loan Details
- Min Amount: £1,000
- Max Amount: £25,000
- Min APR: 11.2%
- Max APR: 34.5%
- Loan Duration: 1 to 10 years ⌛
Services & Industries
- Finance Types: Fixed rate loans, Variable rate loans, Business mortgages
- Industries: Agriculture, Healthcare, Real estate, Technology
Pros
- Established brand
- Multiple loan types
- No early repayment fees
Cons
- High APR for certain amounts
- Limited to UK businesses
NatWest specialises in small business loans for UK enterprises, offering quick access to funds. It is suitable for franchise buyers and SMEs looking for straightforward financing with manageable terms. NatWest loans typically require credit assessment and provide a balance of speed and flexible repayment options.
Loan Details
- Min Amount: £1,000
- Max Amount: £250,000
- Min APR: 10%
- Max APR: 15%
- Loan Duration: 1 to 7 years ⌛
Services & Industries
- Finance Types: Small business loans, Start-up loans
- Industries: Legal, Real estate, Financial services
Pros
- Quick fund access
- Supports a wide range of businesses
Cons
- Higher APR
- Limited loan products
Funding Circle is a peer-to-peer lending platform focusing on term loans for SMEs in the UK. It is generally suited for established businesses rather than start-ups. The platform offers competitive rates with flexible terms, requiring a solid credit profile and no traditional collateral, with straightforward repayment structures.
Loan Details
- Min Amount: £10,000
- Max Amount: £750,000
- Min APR: 6.9%
- Max APR: 15%
- Loan Duration: 6 to 72 months ⌛
Services & Industries
- Finance Types: Term loans, Peer-to-peer loans
- Industries: SMEs
Pros
- Fast processing
- No early settlement fee
Cons
- Not suitable for start-ups
- Requires a solid credit profile
iwoca provides short-term and flexible business loans for a diverse range of UK SMEs. It typically suits businesses needing working capital or quick access to funds. Loan offerings include discretionary terms with variable rates, focusing on speed and accessibility, often without traditional collateral.
Loan Details
- Min Amount: £1,000
- Max Amount: £1,000,000
- Min APR: 6%
- Max APR: 15%
- Loan Duration: 1 to 24 months ⌛
Services & Industries
- Finance Types: Short-term loans, Working capital
- Industries: Retail, Hospitality, Services
Pros
- Very fast approval
- Flexible discretionary terms
Cons
- Higher rates for extended terms
Metro Bank offers fixed-rate commercial loans and business banking solutions suited for growing UK SMEs. Their products focus on predictability and transparent fees, suitable for enterprises that prefer straightforward lending with clear repayment terms. Collateral requirements and eligibility depend on the loan type.
Loan Details
- Min Amount: £2,000
- Max Amount: £60,000
- Min APR: 9.6%
- Max APR: 9.6%
- Loan Duration: 1 to 5 years ⌛
Services & Industries
- Finance Types: Commercial loans, Term loans
- Industries: Retail, Hospitality
Pros
- User-friendly service
- Transparent charges
Cons
- Limited maximum loan amount
Virgin StartUp Loan specialises in funding and mentoring support for UK startups. It is most suitable for new businesses seeking low fixed-rate loans with guidance. The scheme focuses on ease of access and supportive services, with defined loan durations and fixed APRs.
Loan Details
- Min Amount: £500
- Max Amount: £25,000
- Min APR: 6%
- Max APR: 6%
- Loan Duration: 1 to 5 years ⌛
Services & Industries
- Finance Types: Start-up loans
- Industries: Startups
Pros
- Mentoring support
- Fixed low rate
Cons
- Targeted only at startups
British Business Bank offers government-backed support for small UK businesses through debt and equity programmes. It is aimed at new and growing enterprises needing accessible finance with manageable terms. Products typically feature fixed APRs and support a broad range of sectors without complex security requirements.
Loan Details
- Min Amount: £500
- Max Amount: £25,000
- Min APR: 6%
- Max APR: 6%
- Loan Duration: 1 to 5 years ⌛
Services & Industries
- Finance Types: Start-up loans, Small business finance
- Industries: Various
Pros
- Supports new businesses
- Government-backed
Simply Business is primarily known for business insurance but offers financial solutions including loans tailored for small UK enterprises. It is suited for businesses seeking straightforward finance with some flexibility on repayment options. Loan values tend to be moderate, supporting various industries with user-friendly service.
Loan Details
- Min Amount: £1,000
- Max Amount: £25,000
- Min APR: 6%
- Max APR: 9.1%
- Loan Duration: 1 to 10 years ⌛
Services & Industries
- Finance Types: Business loans, Small loans
- Industries: Various
Pros
- Tailored advice
- User-friendly service
Merchant Savvy specialises in sourcing competitive finance options for UK businesses, focusing on unsecured loans and revenue-based finance. It typically suits businesses seeking affordable finance with flexible eligibility. The platform offers access to multiple lenders, helping clients find terms that match their cash flow and working capital needs.
Loan Details
- Min Amount: £500
- Max Amount: £25,000
- Min APR: 6%
- Max APR: 9.6%
- Loan Duration: 1 to 5 years ⌛
Services & Industries
- Finance Types: Unsecured loans, Revenue-based finance
- Industries: Various
Pros
- No application fees
- Low entry requirements
Cons
- Limited to lower loan amounts
How to choose
When selecting lenders with the lowest interest rate business loans, consider your loan amount needs and budget for repayments. Evaluate eligibility criteria carefully to ensure qualification. Balance the speed of funding against loan flexibility and repayment options. Assess the requirement for collateral or security and understand any early repayment fees or penalties. Consider how the loan fits your franchise cash flow and seasonal business cycles to avoid cash shortages.
Conclusion
Choosing the right lender depends on your business type and loan purpose. Banks offer structured products suitable for established businesses needing larger or secured loans, while brokers like Funding Agent provide access to multiple lenders for faster comparisons. Specialists focus on startups or niche sectors with tailored financing. Understanding your priorities around speed, flexibility, and collateral helps in selecting the best fit. This guide highlights providers for typical loans up to 200 thousand pounds to aid your decision.