Barclays Bank Loans

Barclays Bank Loans

A mini-guide to applying for a business loan from Barclays

By Elma Glasgow

For many entrepreneurs, searching for a small business loan is one of the many challenges involved in running a company. Yet, loads of business owners rely on this kind of financing to start and grow their enterprises.

For years fledgling and developing enterprises have relied on business loans from banks, like a Barclays business loan. Although banks have reduced their levels of lending to small businesses in recent years, it may still be worth your time applying. Loans are available, but it’s not as easy as it once used to be.

You need to be prepared to submit the required paperwork and the bank's decision might take a few weeks to come through. As long as you’re in a position to wait as well as meet the requirements of a Barclays business loan, then it could provide the financing you need.

However, if you want a short-term and / or faster funding, there are more convenient options from alternative finance (altfi) providers like Fleximize and Funding Circle.

Is a Barclays small business loan right for you?

Barclays business loans range from £1,000 to £25,000, and can be used for all kinds of purposes – from office renovations to purchasing equipment. The repayment term varies between 1 to 10 years, and loans over £25,000 are also available with repayment over a period of up to 20 years.

As with all business loans you need to make sure you’re applying for a realistic amount. If you’re overly optimistic, you’ll struggle to pay it back and even end up defaulting. But if you underestimate the loan amount, you’ll burn through the money so quickly, you’ll find yourself applying for loan top-up (and possibly incurring additional costs, depending on the lender), or starting your hunt all over again for more money. To prevent this, be careful when calculating your loan amount.

What you need when applying for a loan

As with all finance providers, there are hoops to jump through. Some application processes are more complicated than others, but you need to be prepared before you complete an application. To get a Barclays business loan, expect to give the bank a detailed picture of your venture. This takes preparation, so here are a few things you’ll need to work on before you apply:

Business Plan – If the thought of a business plan fills you with dread, it’s time to tackle that fear head on and develop what is a cornerstone of a growing business. But if you've already got a plan, it could make your lending application faster. Here's some useful advice on writing your first business plan.

Financial information – You'll need to share your growth expectations, and tell Barclays how you’ll find the money to repay the loan. You'll also need to submit profit and loss figures, as well as your forecast for the next year. Prepare a breakdown of costs to show how you'll use the loan, and be ready to share any business savings. Top tip: if you can show that you pay suppliers on time, this could help your application.

Security – Have you planned which assets you can use, if Barclays offers you a secured loan? If your business or level of funding is seen as a higher risk by the bank, it's likely you’ll probably be asked to provide security against the loan like your home (if you own it).

Credit score – How healthy is your credit score? If it's not tip-top, it could seriously impact your chances of securing a Barclays business loan. Check your credit rating with Noddle to become more aware of your position before you many any loan applications. If you're a new company with a short trading history or a bad credit score, and you're turned down by the banks, there are plenty of alternative lenders who'll still consider your application.

Business loans from alternative finance providers

Barclays business lending is just one option – nowadays small businesses have a choice of a wide range of non-traditional finance providers. Lenders like Fleximize have been set up to offer SMEs a quicker, less bureaucratic process, so you can get your hands on the cash a lot quicker.

For more ideas on SME financing, check out The Ultimate Guide to Business Funding.