Businesses all over the UK sometimes require outside funding in the form of a business loan, whether to invest in growth or maintain daily operations. We look at the most recent business loan statistics and trends and how lending to small businesses and small to mid-sized enterprises (SMEs) has changed over the years.
Business loan statistics: Highlights
The total value of business loans was £528 billion in 2024.
Loans to SMEs were worth £62 billion in 2024.
A quarter of SMEs (26%) have sought external finance in the past 3 years.
Almost 1 in 5 SMEs (17%) are considering applying for external finance in the next 12 months.
Working capital was the biggest driver of SME financing demand in 2025.
1 in 8 SMEs (13%) feel concerned about repaying their financing.
The average business loan amount in 2023 was £100,000.
What is the value of business loans in the UK?
In 2024, a total of £528 billion was lent to businesses in the UK, up slightly from £516 billion lent in 2023. Business loans peaked in 2020 during the coronavirus pandemic, with £658 billion lent in total.
Lending to small and medium-sized enterprises (SMEs) by all banks was £62.1 billion in 2024, up from £59.2 billion in 2023.
Loan repayments by SMEs were higher than loans granted in 2024, at £65.1 billion. This is the fourth year in a row that repayments have been higher than lending, following the significant lending seen in 2020.
A lower number of SMEs applied for external finance in 2024 compared to 2023, with just 1 in 4 (26%) seeking this opportunity, down from around 3 in 10 (39%). This number is the lowest it has been in the last 5 years, with 44% applying for finance in 2019, 60% in 2020, 59% in 2021 and 39% in 2022.
Acquiring working capital is the most popular reason for seeking finance among SMEs, with half giving this as a driving reason (51%). The next most common reason is the purchase of fixed assets (35%), followed by investing in business growth (34%).
To develop or introduce new products, processes or services
24%
To deal with recovery
18%
Refinancing
10%
To deal with energy costs
4%
To reduce carbon emissions
4%
Do SMEs feel able to repay their business loans?
1 in 8 SMEs (13%) feel any level of concern about repaying their finance offer, and just 2% are very concerned about doing so. This number is down from 2023, when around 1 in 5 SMEs (22%) were concerned about repaying their finance offer.
The average value of finance sought by SMEs was £14,000 in 2022, up from £10,000 in 2021. Businesses with no employees, such as sole traders, had a lower loan value of £10,000, while SMEs with employees had a higher loan value of £25,000.
In 2023, there was an increase in the number of firms seeking finance with a value of £25,000 or more, with 39% of businesses looking for this larger number. 34% of businesses wanted a loan of less than £10,000, while a quarter of businesses (25%) were looking for financing between £10,000 and £25,000.
Business finance trends by Funding Options
The team at Funding Options by Tide shared exclusive insights with Finder on the trends they saw among their customers in 2023, which we are likely to see continuing into 2024. We’ve outlined these statistics below:
Funding Options received 130,000 lending applications in 2023.
The average business loan amount requested was £100,000.
Capital funding was the biggest driver of SME financing demand in 2023, used primarily for managing day-to-day cash flow and business growth.
Terms loans were the biggest category of finance products in 2023 – a lump sum borrowed from a financial institution with a fixed repayment schedule over a set number of years.
They also shared the top 5 industries seeking business financing, which were:
Wholesale and retail trade of motor vehicles and motorcycles
Construction
Accommodation and food service activities
Administrative support service activities
Professional, scientific, and technical activities
Sophie Barber is a senior content marketing manager for Finder in the UK. She has over 5 years experience in writing and publishing clear, concise and informative articles that help consumers make informed decisions. See full bio
Sophie's expertise
Sophie has written 97 Finder guides across topics including:
Cubefunder offers business loans of up to £100,000 with one fixed fee. Repayments can adapt to the rises and falls of your company’s cashflow. Find out how other lenders compare.
Information about the business loans available from HSBC.
Advertiser disclosure
Finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which Finder receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. Finder compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
We update our data regularly, but information can change between updates. Confirm details with the provider you're interested in before making a decision.
How likely would you be to recommend Finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
