HSBC business loans review December 2019

HSBC offers a wide range of business loans for companies of all sizes. Read on to learn about the various deals that are currently available.

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HSBC UK

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.

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Explaining the HSBC Small Business Loan

  • Fixed monthly repayments mean you’ll know what you’re going to be paying.
  • You don’t have to be an existing HSBC customer.
  • There are no charges for extra loan repayments.
  • You can delay your first payment for three months.
  • Your repayment terms can be anywhere from 12 months to 10 years.
  • You can offset the interest against your tax liabilities.

Key features of HSBC Small Business Loans at a glance

  • Loan durations. Anywhere from 1 year to 10 years.
  • Security. HSBC offers secured loans for which property may be used as collateral. However, if you fail to make your repayments, your property could be repossessed.
  • Fixed monthly repayments. Your business will pay the same amount each month and you’ll know how much the loan is going to cost overall.
  • Option to take a repayment holiday. This serves as a buffer to allow you to see a return on the investments you make with your business loan. Worth remembering that you’ll still be accruing interest during this period.
  • Quick decision. The bank has an online service which will let you know within a few minutes how likely you are to get the money. Once you make an application, however, it may take a few days for an official decision.
  • Set-up fees. There’s a set-up fee payable at the start of the loan.
  • Preferential rates for existing customers. This isn’t explicitly stated on their website, contact them directly for more details.

Interest rates are fixed for the duration of your repayment period, however the rate you’re offered will depend on factors like the amount you apply for, the term of the loan, your credit rating and your income. It may differ from the advertised Representative APR.

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

Frequently asked questions

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