HSBC business loans review 2020

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HSBC business loans comparison

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Name	Product	Loan type	Loan amounts	Loan terms	Turnover/trading criteria
HSBC Fixed Rate Small Business Loan		Fixed rate loan	£1,000 to £25,000	1 year to 10 years	No specified minimum turnover or time trading	Representative example: Borrow £13,000 over 5 years at a rate of 7.1% p.a. (fixed). Representative APR 7.1% and total payable £15,404.01 in monthly repayments of £256.73.	Get quotes View details		loading Fetching your data...
HSBC Flexible Business Loan		Fixed or variable rate loan	From £25,000	1-20 years	No specified minimum turnover or time trading	Get quotes View details		loading Fetching your data...

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HSBC is one of the world’s largest banking and financial services organisations and it serves millions of customers worldwide. The bank was founded in 1836 to facilitate trade between Europe and Asia.

HSBC has a high rate of approval for business lending (93% for loans up to £30,000, as of 2017) and says it is committed to helping British businesses take the first necessary steps to scale the ladder of success. If you need a loan, you can apply via the HSBC site.

HSBC small business loans

HSBC offers fixed rate loans for small businesses looking to borrow up to £25,000, with loan terms between 1 and 10 years. HSBC small business loans have a representative APR of 7.1% for loans between £1,000 and £25,000.

As an accredited lender under the Bounce Back Loan Scheme, HSBC also offers small business loans from £2,000 to £50,000 to businesses affected by the coronavirus pandemic. BBLS loans are provided with a fixed rate of 2.5% p.a.

HSBC business overdraft

If you already have an HSBC Business Current Account, you can borrow money without needing to use security (subject to approval) by using a business overdraft. The interest rate you receive will be linked to the Bank of England base rate. Learn more about business banking.

HSBC asset finance

HSBC asset and equipment finance is designed to let your company access better equipment, vehicles and software today, rather than having to save and wait. You can learn more abut asset financing or compare deals from a range of lenders.

What other business finance products does HSBC offer?

• Fixed and variable rate loans
  A fixed rate loan means you’re protected from increases in interest rates, and can budget with certainty, while a variable rate exposes you to potential increases in interest rates, but could also mean you benefit from any reductions in rates. See HSBC’s current deals or compare fixed rate deals from multiple lenders.
• Business credit cards
  Need a small, ongoing, flexible line of credit? An HSBC business credit cards could do the trick. Check out our review or compare all business credit cards.
• Invoice financing
  HSBC’s invoice discounting service could help your firm maintain a healthy cash flow. Learn more about how invoice financing works or compare invoice financing deals for your business.
• Commercial mortgages
  Scaling-up or relocating? HSBC offers commercial mortgages too. Learn more about commercial mortgages or discover options suited to your business.

HSBC business loan rates

HSBC small business loans have a 7.1% representative APR on loans between £1,000 and £25,000, but the interest rate you receive will vary based on your business’ application and financial situation, as well as the size and length of your loan.

HSBC business overdrafts have a variable representative EAR of 10.36%, with overdraft facility offered with at least a 4% margin over the Bank of England base rate.

Am I eligible for a HSBC business loan?

You should only apply for a HSBC business loan if you’re certain you can meet the repayment terms.

Here are the criteria that you will personally need to meet in order to be eligible for an HSBC Small Business Loan:

• UK resident for at least three years
• Over 18 years old
• Good credit rating without a history of county court judgments or bankruptcy

Information HSBC will need to process your loan application

HSBC will need to know the following:

• A full rundown of how your business operates
• How your particular skills and experience will help you achieve your goals
• Information on how the money you want to borrow fits into your larger goals
• The period over which you want to borrow your money

Proof the bank will need to see to approve your application

• Security/assets. It will often need to see security in the form of guarantees, property or other types of assets that are easy to value.
• Other business interests. It will need to see how many other commitments you and your business will have in order to ensure that you can dedicate the appropriate amount of time in order to grow it properly and make your loan repayments.
• Cash flow forecast. You need to be able to prove that you have a logical and well thought out business strategy and model.
• Financial accounts. The bank will need to see evidence of your past financial history.

HSBC states that its business loans should not be used for anything other than the purpose of investing in your business. Absolutely no personal purchases are allowed.

What can’t HSBC do?

Looking for something else? Outside of the HSBC services listed above, you could also consider the following finance products for your business.

Merchant cash advance

Get a lump sum upfront to repay in-line with volume of future sales. Compare deals and learn how business cash advances work.

Find out more

Business line of credit

Borrow only as much as you need, when you need it, then repay on terms that suit you. Compare a range of lenders.

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Business loans for bad credit

Get live, personalised quotes on unsecured or secured loans from specialist lenders with our partner Funding Xchange.

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Frequently asked questions

• Does HSBC offer loans under the Enterprise Finance Guarantee scheme?

  Yes. If you’re held back by being unable to offer security for a loan, then under this scheme the government effectively acts as your guarantor for 75% of the loan. This doesn’t mean your company isn’t liable (standard procedures will be undertaken by HSBC before turning to the government to recover unpaid funds) but it can help to get applications across the line, or help your business to access larger loans than it might alone.