Comparisons
Straight comparisons of the choices most companies face when raising funding — what each route costs, how fast it moves, and when one clearly beats the other.
Banks are still the cheapest source of business debt for companies that fit their credit policy. Alternative lenders — challenger banks, independent financiers,…
Approaching a lender directly is free and, for a simple facility with your own bank, often perfectly sensible. Where an arranger earns its fee is in access, str…
Both solve the same symptom — money going out before it comes in — but they behave very differently as a business grows. An overdraft is a fixed limit set once …
When the money is buying a tangible, resaleable asset, asset finance is usually cheaper than a term loan because the lender's risk is lower — they hold title, o…
Equity is permanent capital that costs nothing until it costs everything — a share of the business forever. Debt is temporary capital with a defined price and a…
Invoice finance quotes are hard to compare because providers price on different bases. Two facilities with the same headline rate can differ by several percenta…
These two facilities fund opposite ends of the same working capital cycle. Trade finance pays your supplier so goods can move. Invoice finance releases cash onc…
Both are secured on property, but they solve different problems. A bridge buys time. A commercial mortgage buys a long term hold. Using a bridge where a mortgag…
Buying outright is cheaper in total cash terms and almost always worse for liquidity. Leasing costs more over the life of the asset and preserves the cash that …
Both facilities release cash tied up in unpaid invoices, typically an advance of most of the invoice value within a day or two of raising it. The real differenc…
Both let a business acquire equipment without paying the full price upfront, spreading cost over an agreed term. The core distinction is ownership: hire purchas…
A secured loan provides a fixed amount against property, plant or other assets, repaid on a set schedule. Invoice finance instead advances against your unpaid s…
A revolving credit facility works like a business overdraft with an agreed limit that can be drawn, repaid and redrawn repeatedly. A term loan provides a single…
A merchant cash advance provides a lump sum repaid as a fixed percentage of future card sales, so repayments move naturally with turnover. A revolving credit fa…
Private credit funds lend from pools of institutional capital rather than customer deposits, giving them more freedom to structure deals that do not fit standar…
Asset based lending sizes a facility against the value of specific assets such as receivables, stock, plant and property. Cash flow lending instead sizes the fa…
Supply chain finance is arranged by a buyer to let its suppliers get paid early against approved invoices, usually at a lower cost than the supplier could arran…
Both are ways of managing payment risk in international trade using banks as intermediaries, but they offer very different levels of protection. A letter of cre…
Development finance funds the construction or conversion of a property, released in stages as work progresses. A bridging loan provides a single lump sum quickl…
A commercial mortgage lets you borrow against a property you own or are buying, while retaining ownership throughout. Sale and leaseback releases the full value…
Peer to peer lending matches businesses with individual and institutional investors through an online platform, rather than borrowing from a bank's own balance …
Venture debt is a loan facility, usually alongside existing equity investors, that extends a growth business's runway without issuing new shares. An equity roun…
Crowdfunding raises money from a large number of individual backers, either as equity, debt or reward-based pledges, typically through a public campaign. A busi…
A fixed rate loan keeps the interest rate, and therefore the repayment amount, constant for the agreed term. A variable rate loan moves in line with a reference…
A short term loan is typically repaid within a few months to two years and suits an immediate, specific need. A long term loan spreads repayment over several ye…
A single lender provides the entire facility, which keeps the arrangement simple to manage and negotiate. A multi-lender package splits the requirement across s…
Refinancing replaces an existing facility with a new one, often to secure better terms or release equity. Taking an additional facility leaves the existing arra…
Both routes put equipment into the business without paying for it outright. The difference is what happens at the end and who carries the residual value risk. T…
Both release cash from an unpaid invoice. The difference is who sets the arrangement up and whose credit rating the pricing is based on, and that determines whi…
Both let you draw and repay as needed. The essential difference is commitment. An overdraft is usually repayable on demand, while a revolving credit facility is…
Both fill the gap between senior debt and what the owners can fund themselves. Mezzanine is repaid and expensive. Equity is permanent and dilutive. The right ch…
In many markets hard currency debt is quoted at a far lower rate than local borrowing, which makes it look like an easy decision. It is not. The rate difference…
The structure of an acquisition changes what you are buying, what you inherit and what a lender can take security over. It is a funding decision as much as a le…
Both provide cash quickly without property security. The difference is how repayment works. One takes a fixed amount on a fixed date, the other takes a share of…
Invoice finance funds one asset. Asset based lending funds several at once inside a single structure. Bigger is not automatically better, because the wider faci…
Both put vehicles on the road without paying cash up front. The question is whether you want to own the vehicle at the end and carry its resale risk, or hand it…
Senior debt sits at the top of the repayment queue and is priced accordingly. Mezzanine sits behind it, takes more risk and costs more, but it stretches the tot…
Both address the risk of a customer not paying, but only one of them also provides cash. Choosing between them starts with whether your problem is protection, l…
Free money is not free of cost. Grants carry no interest but consume time, carry conditions and rarely arrive when a project needs cash. Debt costs money and ar…