What Alternatives To Small Business Loans Are Available For Small Businesses?

Finding finance options as a small business owner who is looking to grow their enterprise can be difficult. For a business owner, relying on your business bank loan to be accepted by one of the High Street banks gives you no guarantee of getting funding for your small business.

Rather than go for a traditional bank loan from a High Street bank, there are alternative business funding options that are available for small businesses. White Oak UK has a range of  business finance products that can help support and grow your small enterprise.

Here are some alternative finance options that small business owners can use to help their enterprises grow.

Working Capital Loans

If your small business needs capital quickly, then a working capital loan can enable you to access the loan while maintaining equity in your enterprise.

Working capital loans can be used in a variety of ways, from covering recruitment to annual subscriptions and licences and corporation tax costs. This type of loan is designed to help business owners manage their cash flow if they face any financial difficulties, which is likely to happen with seasonal small businesses.

However, if you don’t pay off your working capital loan over a set period of time, then it could affect your business’ credit score. This is an important thing to consider when you decide to take out a working capital loan for your small business.

Asset Finance

Another type of short-term loan that is an alternative to a bank loan is asset finance. An asset finance loan can be used to finance assets and infrastructure that are essential to running your small business.

Asset finance can be used for various purposes, from accessing the latest equipment through equipment leasing to financing a fleet of electric vehicles. When you use this type of loan, the asset you’ve loaned through asset finance is secured against the asset and the business owner has to pay it back with interest.

An important thing to remember if you use asset finance is if you do not keep track of your repayments, then your assets can be seized. It’s imperative that when you decide to make an asset finance loan application that you keep up-to-date with repaying your business assets.


Invoice Finance Loans

Bank loan applications can be a cumbersome process. Invoice finance can enable a small business owner to release funding that is tied up in invoices.

This finance option is a great alternative to small business bank loans as it can help improve the business’ cash flow, as well as raise finance for your important assets. Compared with other finance types, invoice financing does not create debt, which means that you won’t have the burden of having to make monthly repayments with a loan.

Invoice financing is great for small business owners who may experience delays with getting their work completed and paid by a client.

Peer-to-Peer Lending

The penultimate alternative to a small business loan for business owners is peer-to-peer lending. 

Peer-to-peer lending is a new way of getting funding for your small business. How this type of lending works is that the business owner signs up and applies for a loan via a lending platform. Once you have been approved, investors can find you on the marketplace in which they can lend you money for your business.

As they are a new finance option, it’s important that you do your research before deciding to secure funding for your small business with a peer-to-peer lending platform.

Unsecured Business Loans

Unlike a secured loan that requires you to use collateral to access the loan, an unsecured loan does not require you to use assets to access funding for your small business.

As a small business owner, unsecured loans are an excellent option when it comes to getting funding for your enterprise quickly. Unsecured loans come with more risk for the lender, as well as smaller amounts of money to lend with higher interest rates and shorter time periods to repay the loan back.

If you can show to a lender that you can pay off your unsecured loan over a set period of time, it’ll enable you to build a good credit history. By demonstrating that you are responsible in repaying your loan, you increase your chances of borrowing more money for your small business in the future.



There are plenty of finance options available for small businesses to access funding that do not require a bank loan. Whatever option you choose will ensure that your enterprise can continue to grow in the sector that it operates in.

White Oak UK has business development loans that are flexible to your small business’ needs. When it comes to the amount you want to borrow, the loan amounts start from £25,000, all the way up to £2 million for your enterprise.

If you want to learn more about how we can help you, speak to our business finance expert who can assist in finding the best finance option that’s right for your small business.

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If you are looking to find the right finance for your business, contact us today.

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