Restaurant Loan & Merchant Cash Advance Compared [Business Finance]

Lets explore what restaurant loan and business finance options may be available for your business.

If you are running a restaurant in the UK, then you may be wondering what your funding options are. In this article we will run through the different finance products offered by UK lenders specifically for restaurant business owners. We will also highlight how a finance broker like ourselves, can source finance for you.

We will start by looking at the different types of finance products and how they vary. Important things to consider when choosing which type of finance for your include:

  • How much funding you require?
  • How quickly you want to pay it back?
  • Do you have any bad credit either personally or in the business?
  • How long have you been trading for?
  • What is your turnover?

All these factors and more can effect which funding type is available to your business. Lets look at each one.

Compare Restaurant Loan & Finance Types

Here are the main types of specialist business finance available to UK restaurant owners.

Unsecured Business Loan For Restaurants

An unsecured loan option may be available for restaurants that have a proven track record of profitable trading. This type of finance will provide an upfront lump sum payment that is then paid back over 1-6 years, usually with a monthly payments. Interest rates are usually fixed and will vary depending on the strength of your business.

Most unsecured loan lenders will look for 2 – 3 years trading history and filled accounts for this type of loan.

Key Features Include:

  • Spread monthly payments over 1 – 6 years
  • Annual Interest Rates from 3%
  • Fixed monthly repayment

You can read more about this on our Business Loans Page.

Restaurant Merchant Cash Advance

A Merchant Cash Advance (MCA) may be an option if you are taking customer card payments either at the table, over the phone or online. This could be for table service and/or just takeaway food business.

With an MCA you can potentially borrow up to 150% of your average monthly card takings. The loan is then repaid as a percentage of your future card takings, making repayments flexible and in line with future revenue.

This option is suitable for restaurants that have been trading from 4 months or more.

Key Features Include:

  • Borrow up to 150% of average monthly card takings
  • Fixed repayment amount
  • Repay percentage of future card takings
  • Works with Just Eat, Uber Eats and Deliveroo
  • Only need 4 months trading to apply
  • Owners & Directors don’t need to be a home owner
  • High acceptance rate (Even with bad credit)

This type of funding may also be referred to as a Business Cash Advance. You can read more about this type of finance on our Merchant Cash Advance Page.

Secured Loans & Mortgages For Restaurants

If you are looking to purchase a building for your restaurant to trade from, you could arrange a secured loan or commercial mortgage.

Unless you can provide additional security to the lender, the restaurant will need a proven trading history and affordability.

Click here to read more about Commercial Mortgages.

Asset Finance For Kitchen Appliances & Equipment

If you are looking to spread the cost of an asset purchase, then asset finance can be used for this purpose.

Apply Today For Restaurant Finance

As an independent commercial finance brokers, we are experienced in sourcing a range of finance options for restaurants.

Fill in the form below and will be get in touch straight away. You can find our full details on our contact page.

Contact Us

By clicking "SUBMIT", I agree to Bolton Business Finance Terms and Conditions and Privacy Policy.