Barclays offers a range of secured and unsecured business loans for UK SMEs, but how do they stack up on speed, flexibility and cost? We break down their loan options, current interest rates, eligibility requirements and how they compare to flexible alternatives like iwoca.
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Barclays Bank is one of the Big Four UK banks, with a long-established presence in the business banking space. Barclays offers a wide range of different business borrowing products, ranging from smaller unsecured loans for new startups to bigger secured loans for larger corporate enterprises.
To give you a better idea of which Barclays business loan is suited to your business needs, here’s our overview of the entire loan product range.
When you take out a business loan, it’s important to understand how much the business needs to borrow, your available budget for making repayments and how long you’ll expect to take to repay the borrowed funds.
Armed with this knowledge, you can choose the Barclays business loan that’s right for your current needs and cash flow position.
Let’s take a look at the available Barclays loans
If you’re looking for a small business loan then an unsecured business loan may be the ideal route to funding. Due to the smaller amounts being borrowed, you don’t need to offer collateral when taking out an unsecured loan. This means your business assets and equity are not used to secure the loan with the lender.
A Barclays unsecured loan allows you to borrow up to £100,000 and can have funds in your account within 48 hours of you signing the final paperwork. This makes it ideal for new businesses, start-ups and smaller businesses that need straightforward access to funding to help grow the business or overcome a cash flow glitch.
A Barclays unsecured business loan offers:
When larger amounts of funding are needed, a secured business loan is likely to be the best fit. Secured loans offer greater borrowing, so they’re useful when you intend to spend a significant amount on new equipment, or growing the business.
However, the loan will require you to provide collateral to secure the loan. These assets could be machinery, vehicles or even property owned by the business.
A Barclays secured loan offers loan amounts from £100,000 upwards, with the upper limit for borrowing negotiable with the bank.
A Barclays secure business loan offers:
A green business loan allows you to borrow and invest in green and sustainable assets. This gives you the funding to improve your sustainability credentials by investing in solar panels, battery storage, electric vehicles and other green assets.
A Barclays green loan for business allows you to borrow from £25,000+ and to use these funds to invest in certain qualifying green assets. You may also be eligible for reduced interest rates on this green loan, if you meet certain criteria.
The Growth Guarantee Scheme (GGS) was launched July 2024 as a replacement for the now retired Recovery Loan Scheme. It’s backed by the UK Government and is designed to offer access to finance for UK small businesses that need growth funding.
Through Barclays, the Growth Guarantee Scheme offers:
Before taking out a business loan, it’s sensible to understand the interest rate you’re agreeing to as part of the loan’s terms and conditions. The higher the interest rate, the more you’ll end up repaying over the period of the loan. So, it’s important to find the lowest possible interest rate and to minimise the repayment commitment.
Banks and lenders will generally quote an APR or representative APR percentage for their interest rates. Here’s what that means:
At the time of writing, Barclay’s representative APR is 12.9%.
This rate will change over time, as the Bank of England base rate of interest fluctuates and the bank amends their representative APR rate to factor in any new base rate or any changes in economic conditions within the lending market.
Different banks and lenders will have different representative APRs, so it’s a good idea to shop around between lenders. For example, HSBC small business loans currently offer 11.3% representative APR for loans up to and including £10,000, and Tide startup business loans offer 6% APR for loans up to £25,000.
Note – always check the current APR rate before agreeing to any loan.
The APR on the loan is a significant factor to think about when deciding which lender and loan product is right for you. But it’s not the only consideration.
You should also review:
Review the T&Cs to check what you’re agreeing to when signing on the dotted line. Can you choose the loan amount or terms? What’s in the small print?
Some loans are aimed at specific business types, industry sectors or funding purposes. Check if your business meets the conditions for the loan.
Many lenders will apply a penalty if you repay the loan before the agreed end of the term. Make sure you’re aware of any such penalties before you sign.
How long will it take to access the borrowed funds? Barclays quotes 48 hours for some loan products, but this may be too slow for your needs.
Barclays has no minimum repayment time requirement. You can repay the balance of your loan at any time, in part or in full. There are no charges for this.
If the business loan process from Barclays and the other major banks is sounding too complex and inflexible, don’t worry. There are alternative ways to take out a small business loan and fund the next stage of your growth. .
Digital challenger banks will usually have a smoother process with fewer complicated credit checks. And other business finance providers, such as iwoca, can streamline the whole process of accessing the money you need.
An iwoca Flexi-Loan overcomes the problem of slow access to your funds.
To make it easier to understand your potential repayments, banks and lenders often include a loan calculator tool on their websites.
The Barclays business loan calculator allows you to enter the amount and your chosen term for the loan. It then calculates the monthly repayment amount, the total repayment for the whole loan and the representative APR for the loan.
For example, here’s an example borrowing £10,000 for two years:
To find the Barclays loan calculator for business loans, head to the Barclays business loans page and then scroll down to the Business Loan Calculator section.
Simply enter the amount you want to borrow, and your chosen term for the loan (the timeline for paying back the loan in full).
Using the calculator is important because it tells you:
To successfully apply for a loan, you’ll need to meet Barclay’s business loan requirements. Hitting these eligibility criteria is vital if you want your application to be considered and to tick all the right boxes.
To be eligible for a Barclays business loan you must:
As part of the loan application process, you’ll need to send Barclays the following documents to verify the identity of yourself and the business.
These documents will also demonstrate the viability of the business, the purpose of the loan and the quality of your financial, payment and credit management.
Be ready to provide the following.
As one of the largest UK banks, Barclays eligibility criteria is broadly similar to the other Big Four banks, HSBC, NatWest and Lloyds TSB.
The main high-street banks, like Barclays, are highly risk averse and will require very specific documentation, verification and assurances before they will lend any funds.
If meeting these complex requirements isn’t ideal for your business, it’s worth considering alternative business lenders, such as iwoca.
When you apply for an iwoca Flexi-Loan, the whole process takes place online without any paperwork. We can speed up the review process with our direct integration to your cloud accounting software. This allows us to check and verify your financial position extremely quickly.
With the additional identity information supplied via the online form, we can usually give you an answer on the loan, and have the money in your account, within 24 hours.
When it comes to applying to Barclays for a business loan, there are multiple ways to begin the loan application process.
Let’s explore your options:
Like any bank or lender, Barclays will want to see evidence that you’re a good prospect as a borrower. To improve the likelihood of your application being successful:
Barclays states that approval times can be as little as 48 Hours. But, given the amount of documentation required, and the traditional lending process of high street banks, approval times are more likely to take several days – possibly weeks.
You can obviously speak to your business relationship manager to try and speed up the approval process, if time is tight. But big banks tend to move slowly, and will stick to their own internal timescales for the approval process.
In comparison, applying for a large business loan with iwoca could take a matter of hours.
Barclays, like most lenders, uses personal guarantees to mitigate risk. A personal guarantee means that you, as the director or owner, are personally liable for the loan if the business defaults.
You’re more likely to be asked for a personal guarantee if you’re a smaller business or start-up, where the business's financial stability might be less certain.
As we’ve seen earlier in the article, there’s a specific difference between a Barclays unsecured business loan and a secured business loan.
Secured loans are generally used for large amounts of lending and require collateral (business assets) to secure the loan with the lender. If you default on the loan, these assets can be seized. Unsecured loans are smaller and require no collateral.
A secured loan will be the best fit when you need more than £100,000 of funding. With Barclays, you can choose from fixed or variable rates of interest and can choose your own repayment terms, up to a maximum of 25 years.
An unsecured loan is a good option when your borrowing needs are smaller, or you have no assets to offer as collateral against the loan.
With a Barclays unsecured business loan you can borrow up to £100,000 and enjoy the benefits of a fixed interest for the duration of the loan. Funds can be available within 48 hours.
We’ve explained already that the APR and interest rate on your loan isn’t the only factor when deciding which bank or lender to approach. But that interest rate is a big driver of your decision-making process.
Lower interest rates mean smaller monthly repayments and a small overall repayment total and are well worth searching out.
Here’s how Barclay’s current interest rate compares with the competition:
Barclays APR sits around the middle of the market. It’s not the cheapest interest rate when taking out a business loan, but it’s also not the most expensive option either.
If you’re looking for a simple, straightforward and speedy way to access business finance, an iwoca Flexi-Loan is a great fit.
There’s no paperwork involved. The whole loan application process happens online, allowing you to borrow £1,000 - £1,000,000 and get the funds in less than 24 hours.
It’s the perfect way to bridge gaps and seize the next business opportunity.
