Business Banking

Let us guess, you get no interest on your business' cash in the bank and when you want to borrow you get charged unpalatably high rates?

You probably also get charged for just about everything else you do through the bank and at the same time you're getting less and less 'quality time' from your relationship manager.

We're a new online marketplace where small businesses and people can directly lend to other small small businesses in the UK, sidestepping the banks in the process. So whilst we aren't a bank we can help you get a better return on your cash and reduce your cost of borrowing through our online marketplace.

Our marketplace offers £5-250,000 business loans with a 1, 3, or 5 year term and by cutting out the bank lenders get a much better return.

Funding Circle is a new alternative to business banking for saving and borrowing

“Funding Circle is a fantastic solution to the sparse bank funding available in the current economic environment. Because of the risk averse attitudes of the banks, many growth strategies are unrealised and their potential untapped. Funding Circle gives business the ability to obtain funding from people who want to invest and receive a much better return than their savings would give. This system allows hard working business’ to achieve their potential and create wealth. We found the process very user friendly and quick, once the funding was reached, the money was deposited in our account within three days.... with minimal bureaucracy, excellent service! Recycling company, Northumberland

There are several different ways in which repayment for business bank loans can be charged. Both the repayment schedule and the types of interest rates should be taken into account when considering the best options for business bank loans.

Business bank loans will usually charge interest on the money that you company borrows. There are two ways in which this interest can be paid:

• Fixed rate:

  Your business will pay a fixed interest rate for either the length of the loan or for a set period of time. Of course in this instance your business would not benefit from a fall in the market interest rates; but then if you agreed a rate at a time when interest rates were low, then your business may benefit from fixed rates. If your business has agreed to a fixed rate loan and chooses to repay the loan early, it is likely that you would be charged some form of early redemption fees.

• Variable rate:

  A variable rate fluctuates over the life of the loan. This interest rate is tied to the Bank of England Base rate and a margin is agreed above the base rate at the beginning of the loan.

Business bank loans are typically very costly. Not only are there the interest rates to consider, but there are likely to be other administrations costs, such as arrangement fees and early repayment fees. Bank loans are time consuming to access, have high interest rates and have a collection of fees- some visible and some hidden. For example, banks will charge you an early repayment fee if your business does better than expected and you want to pay back the loan. Hardly fair is it? At Funding Circle there are no hidden fees.

So how does it work?

Funding Circle credit assesses all business borrowers before allowing them into the marketplace. Once a business passes the underwriting process people offer small amounts to lots of different businesses to spread their risk. The lowest interest rate offers are accepted by the business thereby giving it the lowest cost of finance possible. Watch the video to find out more and get started!

Related info: Business credit cards | Business overdraft | Small business banking | Business bank loans | Best business banking