Business Loans – Spotcap
Spotcap provides unsecured loans to businesses with an annual turnover of at least £500,000.The global company was established in 2014, launched in the UK in 2016 and now works with over 1000 customers.
What type of business finance does Spotcap offer?
Spotcap offers lines of credit, ranging in value from £50,000 to £250,000. Once you draw down from your line of credit, the money you borrow is treated as a loan.
What’s a Spotcap line of credit?
Good question. A line of credit is a flexible option for businesses that want access to extra finance as and when they need it. If accepted for a Spotcap business loan, you will be informed of your credit limit, which will depend on the outcome of Spotcap’s analysis of your business’s financial health.
How does a Spotcap line of credit work?
Your line of credit usually lasts for around a month and you can decide when and how much you want to draw down within that time frame. You are then only charged interest on the actual amount you draw down, rather than your entire credit limit. You will be expected to repay the amount borrowed in monthly installments, much like most other standard business loans.
After the loan is fully repaid, in three months time you can re-apply for a rescore and
Spotcap will reassess your business’s financial condition. If you don’t draw down on your line of credit within the one month time frame, you won’t incur any charges or costs.
How does Spotcap decide who to lend to?
Spotcap looks at a range of factors to decide whether applicants are eligible and to also work out how much they could offer. A credit check on the business and the directors is often a part of this, but they will also look at cashflow and other financial indicators. The minimum requirements for applying are: an annual turnover of at least £500,000 a year, profitability, a minimum of three years trading history and a UK base.
Who might want to take out a Spotcap business loan?
As a business owner, you may find that during certain months of the year, your cashflow struggles to keep up with your outgoings due to fluctuations in income, or gaps between receivables for example. A line of credit can provide you with access to cash when you need it.
Alternatively, you may want to use a Spotcap line of credit to invest in growing your business by buying new equipment or stock, or refurbishing your premises, for example.
Is there a complicated application process involved?
The process for applying for a Spotcap business loan is online and is relatively straightforward. Spotcap will ask you to upload some financial documents such as bank statements & VAT returns and asks some other questions about you, personally, as well as about the business more generally.
Spotcap uses years of banking experience combined with in-house technology to decide who to lend to, as opposed to basing the decision purely on the outcome of credit checks.
How much does a Spotcap business loan cost?
This will depend on several factors, including the amount you draw down, the period over which you repay the loan and the interest rate you are offered. Your financial position and credit rating will also influence these factors and, therefore, the overall cost of the loan. There
may also be an arrangement fee to consider.
Can I repay my Spotcap business loan early?
Yes. You are able to make early repayments with no early repayment fees after one month.
How does a line of credit differ from a standard unsecured business loan?
A line of credit is different from a standard business loan because you are only charged interest on the amount you actually draw down. The advantage of this is that you are only paying interest on money you are spending, rather than on an entire loan amount, even if it is just sitting in your account.
However, you may find that a standard business loan comes with a lower interest rate and may cost less overall, depending on how much you need to borrow. It’s advisable to research different funding options before you begin the application process.