Business loan guide
Compare Business Loans and Finance Types
The right business finance depends less on finding a single “best” loan and more on matching the type of finance to what you need it for. This guide compares the main options side by side, then shows how to compare offers fairly once you have them.
Not sure which type fits? Wize Finance can help your business see which types of finance may suit what you need.
Know roughly what you need it for? Tell us the amount and purpose, and the team reviews your enquiry and helps you weigh up the types that may fit.
Types of business finance compared
| How it’s repaid | What it’s based on | May suit | |
|---|---|---|---|
| Unsecured Business Loans | Fixed regular repayments over an agreed term | Trading performance and credit history | A defined need without offering property or assets as security |
| Secured Business Loans | Regular repayments over an agreed term | Property or assets offered as security, plus affordability | Larger amounts or longer terms |
| Business Line of Credit | You draw what you need and repay what you use | Trading performance | Uneven or recurring cash-flow needs |
| Merchant Cash Advance | A share of future card takings | Card sales | Businesses with steady card income |
| Invoice Finance | Repaid when customers pay their invoices | Unpaid invoices | Businesses waiting on customer payments |
| Asset Finance | Regular payments under an agreement | The asset being financed | Buying equipment, machinery or vehicles |
| Short-Term Business Loans | Over a shorter term, often with more frequent repayments | Trading performance | Short, defined needs |
| Business Refinancing & Debt Consolidation | A new agreement replacing existing borrowing | Existing debts and affordability | Simplifying or restructuring what the business owes |
Which type fits which need?
- Paying for a one-off purchase or project: a term loan, secured or unsecured, or Asset Finance if it’s equipment or vehicles.
- Covering gaps between money in and money out: Working Capital Loans, a Business Line of Credit or Invoice Finance.
- Buying stock to sell: Stock Finance.
- A VAT or tax bill: VAT Finance.
- Combining existing debts: Business Refinancing & Debt Consolidation.
- Larger requirements: Large Business Loans.
- Property: Property Finance.
Know what you need the money for?
Tell us about your business and what you need, and see which types of finance may suit it.
How to compare offers fairly
Once you have offers, compare them on the same basis:
A lower monthly payment over a longer term can mean paying more in total.
Which matters more depends on your cash flow and plans. Wize Finance can talk through how different types of finance compare on total cost, term and flexibility.
Questions to ask before you accept
- What’s the total I’ll repay, including all fees?
- What happens if I miss a payment, or want to repay early?
- Is any security or personal guarantee involved, and what does it cover?
- Are there conditions on how I use the money?
Compare business loans FAQs
What’s the best type of business loan?
There isn’t one best loan for every business. The right type depends on what the money is for, how and when the business can repay, and whether security is available. Comparing types against your need is a better starting point than comparing headline rates.
Should I compare interest rates or total cost?
Total cost. Different products express their cost in different ways, so the total amount repayable, including fees, is the fairest way to compare.
Is a secured or unsecured business loan better?
Neither is automatically better. Secured lending uses property or assets as security and may suit larger amounts. Unsecured lending doesn’t use security over specific assets but often involves a personal guarantee. See Business Loans Without a Personal Guarantee.
Can I compare business loans without affecting my credit file?
That depends on the lender and the stage of the application, because some checks are recorded and some aren’t. Ask any lender or broker how a search will be carried out before you agree to it.
Does Wize Finance compare lenders for me?
Not in the sense of a price-comparison site. Wize Finance reviews your circumstances, discusses which types of finance may suit your business and, where appropriate, introduces you to one of its selected funding partners. Any offer and its terms come from the lender.
Find the finance that fits
Tell us what your business needs and see which types of finance may suit it.