How to Secure a Business Loan Without a High Street Bank
Getting turned down by your bank, or not even bothering to apply, is more common than you may think. But a high street rejection doesn’t mean the end of the road. In fact, for many UK businesses, it’s just the beginning of finding a funding solution that actually works for them.
Whether you’ve had a knock-back from a traditional lender, you don’t meet the criteria for a standard bank loan, or you’d simply rather work with someone who takes the time to understand your business rather than running it through an algorithm, there are real, credible alternatives out there. And they’re more accessible than most business owners realise.
In this article, we’ll walk you through the main options, explaining how government-backed schemes like the Growth Guarantee Scheme and Start Up Loans Scheme work, and showing you what to look for when choosing a lender that genuinely has your best interests at heart.
Why Are So Many Businesses Turned Away by High Street Banks?
Over the years, the larger banks have tightened their lending criteria considerably. Their decisions are largely driven by automated credit scoring systems, which means that if your business doesn’t tick every box on paper, your application can be declined before anyone has even looked at the details of what you’re trying to do.
Common reasons businesses get turned down include:
Limited trading history – banks typically want to see two or more years of strong accounts
Imperfect credit history – either personal or business credit issues can quickly rule you out
Lack of security or assets – high street lenders will often require collateral
The nature of the business itself – start-ups, sole traders, or businesses in certain sectors can struggle to meet standard criteria
Loan size – smaller loans are often considered uneconomical for big banks to process
The good news is that each of these obstacles is something that alternative lenders, particularly community lenders and those accredited under government-backed schemes, are specifically set up to deal with.
What Are the Alternatives to a High Street Business Loan?
1. Community Development Finance Institutions (CDFI)
CDFIs are specialist lenders whose whole purpose is to support businesses that can't access finance through mainstream channels. Unlike banks, they don't make lending decisions based purely on algorithms or rigid scoring systems. Instead, they take a human approach, looking at the full picture of your business, the person behind it, and what you're trying to achieve.
As a CDFI and FCA-regulated lender, Let's Do Business Finance works with businesses across the Southeast and East of England that have often been unsuccessful elsewhere. Our Business Managers get to know your business properly before making a lending decision – your trading history, your vision, your market, and the people involved. Numbers matter, but they're not the whole story.
We offer business loans from £25,001 to £250,000 for established businesses, with a maximum repayment term of six years.
2. Growth Guarantee Scheme
The Growth Guarantee Scheme (GGS) is a government-backed lending offering, delivered through the British Business Bank. It was designed to make it easier for small and medium-sized businesses across the UK to access finance by providing accredited lenders with a partial government guarantee on eligible loans.
What that means in practice is that lenders like Let's Do Business Finance can take on a degree of risk that a standard bank might not, which opens the door to businesses that would otherwise struggle to borrow.
Let's Do Business Finance is an accredited lender of the Growth Guarantee Scheme, which means eligible businesses applying through us can potentially access funding on more favourable terms than they'd find through a traditional lender.
Key things to know about the Growth Guarantee Scheme:
Available to UK-based small and medium-sized businesses
Funding can be used for a range of business purposes, including cash flow, investment, staffing, and growth
The government guarantee sits behind the lender, not the borrower – you are still responsible for repaying the loan
We will assess your application and advise whether the GGS is the right fit for your circumstances
If you've been declined elsewhere or you're looking to borrow a larger amount, the Growth Guarantee Scheme could be the route that makes it possible.
3. Start Up Loans
If your business is in its early stages (either not yet trading or having been up and running for less than five years), the Start Up Loans scheme is well worth exploring.
Start Up Loans are personal loans for business purposes, delivered through the British Business Bank via Official Delivery Partners like Let's Do Business Finance. They were specifically created to give entrepreneurs access to affordable, unsecured funding at a stage when most traditional lenders simply wouldn't engage.
Here's what the scheme offers:
Borrow between £500 and £25,000 per director (up to £100,000 per business where multiple directors apply)
Fixed interest rate of 7.5% per annum
Repayment terms from 12 to 60 months
No application fees and no early repayment charges
Free mentoring and business support included as standard
Unsecured – no need to put up property or assets as collateral
Crucially, one of the eligibility criteria for a Start Up Loan is that the applicant believes they would be refused a standard bank loan. In other words, this scheme exists precisely for people in that position.
As an Official Business Support Partner of the Start Up Loans Company and a regional delivery partner for the South and East of England, Let's Do Business Finance supports founders through every stage of the application, from developing a business plan and cash flow forecast, right through to receiving the funds and beyond.
4. Our Own Business Loan
Alongside the Growth Guarantee Scheme, Let's Do Business Finance also offers our own business loan product. When you apply, we assess which loan you are most suited for based on your circumstances and the eligibility criteria for both schemes, so you don't need to figure that out yourself before approaching us.
Our business loans are available to businesses primarily over 24 months old, though earlier-stage businesses can also be considered. The funding can be used for a wide range of purposes, such as managing cash flow, investing in equipment, taking on staff, expanding to new premises, or scaling up operations. You can find more details on our eligibility criteria here.
What Do You Need to Apply?
The specific requirements will vary depending on which type of loan you're applying for, but as a general guide, you should be prepared to provide:
For a Start Up Loan:
A business plan
A cash flow forecast for the loan period
Personal identification and proof of address
Details of any existing personal debts or financial commitments
Evidence of your business idea and your experience in the relevant sector
For a Business Loan or Growth Guarantee Scheme Loan:
Recent business bank statements (typically 6–12 months)
Up-to-date management accounts or annual accounts
A clear explanation of how you intend to use the funding
A cash flow forecast showing how the loan will be repaid
Details of any existing borrowing or financial commitments
At Let's Do Business Finance, our Business Managers are always on hand to help you pull your application together. If your business plan or cash flow forecast needs work, we won't just decline you and wish you well, but rather work with you to get your application in the best possible shape!
Check out our blog titled ‘What Do Lenders Look for When Financing a Business?’ to understand what lenders look for that can dramatically improve your chances of success.
How to Give Your Application the Best Chance
Regardless of which route you take, a well-prepared application will always stand you in better stead. A few practical tips:
Know your numbers. Make sure your accounts are up to date and that you can clearly explain your turnover, key costs, and profit margins. Lenders want to see that you understand your own business financially.
Be specific about what the money is for. "Working capital" or "growth" on its own isn't compelling. "To purchase a second piece of equipment to fulfil increased orders from three new clients" is. The clearer the purpose, the more confident a lender will be.
Prepare a realistic cash flow forecast. Show how the loan repayments will be covered month by month. Build in contingency for quieter periods. Lenders aren't looking for perfection – they're looking for honesty and reasonableness.
Check your credit reports before you apply. Review both your personal credit (via Experian, Equifax, or TransUnion) and any business credit record. If there are any errors, challenge them before you apply.
Don't be put off by a previous decline. A rejection from a high street bank does not mean your business isn't fundable. It often just means you need a different type of lender – one who will look beyond the numbers.
How Let's Do Business Finance Can Help
We've supported hundreds of businesses across the Southeast and East of England to access finance they couldn't get anywhere else, from sole traders launching for the first time to established businesses taking the next step in their growth journey.
We're not a faceless institution. We're a team of people who care about the businesses we work with and want to see them succeed. If you've been turned away by your bank, or if you're not sure which product is right for you, the best place to start is a conversation.
Whatever stage you're at, we'd love to have a chat. Get in touch with our team to get started.