RBS business loans review October 2019

The Royal Bank of Scotland, commonly known as RBS, offers both unsecured and secured loans to suit your business needs.

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RBS

RBS, one of the “Big Four” UK banks, is a common sight on UK high streets. Founded almost 300 years ago, RBS invented the overdraft which was considered an innovation in modern banking.

If you’re dreaming of starting a business from scratch, or need some help to expand your current business, RBS offers a variety of business loans that can help. It’s straightforward to apply for a loan on the RBS website – and you’ll get a decision in minutes.

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RBS loan options

  • Small Business Loan. This loan has a fixed rate of interest for the duration of the loan and is aimed at small to medium businesses with a turnover of up to £2 million.
  • Variable Rate Loan. The interest rates on this loan may vary, meaning your monthly repayments may rise and fall. This loan is available for customers with a turnover of more than £2 million.
  • Fixed Rate Loan. Similar to the RBS Small Business Loan, this type of loan has a fixed rate of interest for its duration but it is available to business customers with a turnover of more than £2 million.
  • Commercial Mortgage. RBS’s Commercial Mortgage is designed to help you secure your business premises. There is no early repayment or arrangement fee with this type of loan and you can choose whether you would like a fixed or variable rate.

Key features of RBS business loans at a glance

RBS offers several different loans, so it is worthwhile understanding the features and benefits so that you can pick the one that’s right for you.

  • Loan duration. You can borrow from 1 to 10 years.
  • Loan amount. You can borrow from £1,000 to £50,000.
  • Security. The Small Business loan requires a form of security to settle any debt; any property used for security, such as your home, may be repossessed if you don’t keep up your repayments.
  • Fixed monthly repayments. With these loans, you will pay the same amount every month, so you will know how much money is going out and will be able to manage your cashflow.
  • Quick decision. You could get a decision about whether you’ve been approved or not in 10 minutes.
  • Quick access to funds. You will have access within 2 days.
  • No set-up fees. There are no arrangement fees, so setting up your loan is completely free.
  • Preferential rates for existing customers. If you already bank with RBS, you could be eligible for personalised rates.
  • Repay your loan early at any time. As RBS offers a wide variety of business loans, the terms for early repayment vary. It is important to check the terms of your loan before you attempt an early repayment.
  • Loan durations. Loan terms are between 3 months and 25 years.
  • Loan amounts. You can borrow upwards of £35,001, with no upper limit subject to credit approval.
  • Security. Security may be required, such as in the form of property, to settle any debt if you fall behind on your repayments or your asset could be repossessed.
  • Fixed monthly repayments. With a variable rate loan, your monthly payments could rise or fall as it follows the market rate.
  • Option to take a repayment holiday. You are eligible to take a repayment holiday at the start or in the middle of your loan term. This, however, will mean you end up paying more money as interest will still build.
  • Quick decision. You could get a decision about whether you’ve been approved or not in 10 minutes.
  • Quick access to funds. You will have access within 2 days.
  • Set-up fees. Set-up fees may apply, depending on how much money you want to borrow and for how long.
  • Preferential rates for existing customers. If you already bank with RSB, you may be eligible for a personalised quote.
  • Repay your loan early at any time. There are no early repayment charges for this loan, however, you should check with your provider before you make an early repayment.
  • Loan durations. The loan terms are 3,5,7 or 10 years.
  • Loan amounts. You can borrow from £35,001 to £500,000.
  • Security. Security may be required in the form of property to settle any debt if you can’t meet your repayments. This could be repossessed if you fail to make payments.
  • Fixed monthly repayments. Fixed payments mean you know how much money will be going out every month, and can help you to manage your cashflow.
  • Option to take a repayment holiday. You are eligible to take a repayment holiday with this loan, but it will cost more overall as you must keep paying your interest.
  • Quick decision. You could get a decision about whether you’ve been approved or not in 10 minutes.
  • Quick access to funds. You will have access within 2 days.
  • No set-up fees. There are no arrangement fees, so setting up your loan is completely free.
  • Preferential rates for existing customers. If you already bank with RBS, you may be eligible for a personalised quote.
  • Repay your loan early at any time. With an RBS Fixed Rate Loan, there are no fees for early repayment. However, you should always check with your provider first.
If you opt for a fixed-rate loan, interest rates are fixed for the duration of your repayment. The interest rates will depend on factors such as how much you borrow and for how long, as well as your credit rating and your income. It may differ from the advertised representative APR.

If you opt for a variable rate loan, the interest rates may not be the same every month and will instead match the market rate.

Am I eligible for an RBS business loan?

You should only apply for a RBS business loan if you are certain that you can meet the repayment terms. You must also meet the following criteria:

  • UK resident
  • Aged 18 or over
  • Your registered business address must be in the UK, Channel Islands, Isle of Man or Gibraltar
  • The loan must be used for business only
  • You need to provide evidence of your accounts for the previous 24 months, as well as any tax returns, and a business bank account statement for the previous 6 months
  • Turnover of up to £2 million
  • You must hold a good credit rating without a history of county court judgments or bankruptcy.

How can I apply?

If you have decided that a RBS business loan is right for you, you can apply for the loan on the website. Simply fill in the application form, and you will receive a decision in minutes. You will need to provide your personal and business details. You will also need to provide proof of the following:

  • Your ID
  • Your address details for at least the past 3 years
  • Your business accounts.

Alternative sources of funding

  • Asset finance. If you’re an SME, asset finance can help you spread the cost of business purchases, such as manufacturing equipment or software.
  • Arranged business overdraft. An overdraft is a quick and short-term solution to needing funding. With an RBS overdraft, there is no minimum amount to be paid back every month, and you only pay interest on the amount of money that you use. You can also borrow up to £50,000 unsecured.
  • Business credit cards. Business credit cards are worthwhile to consider, as you can spread the cost of any purchases over an extended period of time. With RBS, there is no annual fee for start-ups, and there is a interest free credit period of 45 days on purchases. The cost of the card is £32 a year per cardholder, and there is a credit limit of £500 to £10,000.
  • Government loan schemes. The government offers startup loans for new businesses, with borrowing amounts ranging from £500 to £25,000. There are criteria that you will have to meet to be eligible for this loan, such as being over the age of 18 and a UK resident, and having a business that has been trading for less than 24 months. For more details about the government loan, visit www.gov.uk/apply-start-up-loan.

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