Payment difficulty
8 articles in this topic.
Can I get a payment extension?
A payment extension gives you a little extra time on a single payment when a one-off event — an unexpected bill, a delayed wage — means the due date is difficult.
An extension is best suited to a short, temporary gap rather than an ongoing shortfall. If your business is likely to find several payments difficult, a longer-term arrangement is usually the better route, and we can talk that through with you.
Please request an extension before the payment is due, using the Payment Extension form. We will confirm the new date and any effect on your schedule in writing. If money is tight more broadly, see what to do if you are struggling to pay and our hardship and forbearance process.
I am struggling to pay — what should I do?
If you are finding it hard to keep up with payments, the most important thing is to tell us early. We would much rather help than see an account fall behind.
Depending on your situation we may be able to offer:
- a payment arrangement spreading what you owe over a manageable schedule;
- a short payment extension to give you breathing space;
- a hardship variation if your difficulty is longer term.
You can start any of these with our online forms, and we will always treat your situation sensitively.
I need extra support — how do I tell you?
We want every customer to be able to deal with us comfortably. If you have a health condition, a disability, a recent bereavement, caring responsibilities, or anything else that affects how you would like us to communicate or what you can manage, please tell us.
Use the Additional Support Needs form. We will record your needs, handle them sensitively, and take them into account in everything we do — including pausing contact where appropriate.
What happens, step by step, if a payment is missed?
Missing a payment is stressful, and not knowing what happens next makes it worse. So here is the honest, step-by-step version — what we charge, what we do not, and how to stop it early. The short answer: there is no penalty spiral, and talking to us is always the best move.
1. The payment doesn't arrive
If a scheduled payment fails — most often a Direct Debit that bounces — we will let you know. A failed Direct Debit on its own is common and fixable; see what happens if my Direct Debit fails. The best thing you can do at this stage is contact us, ideally before the due date if you already know it will be tight.
2. A single late fee may apply — and nothing compounds
If a payment is genuinely missed, a single late fee may be added for that missed payment. Crucially, that is it: there is no penalty-rate uplift, and interest does not jump or compound because you fell behind. Default interest, where it applies, is charged at the same headline rate as the normal loan and stops once the balance is cleared. See will I be charged a fee if I miss a payment for the detail.
3. The 100% cost cap still protects you
No matter what happens with missed payments, the total cost of a single loan is capped at 100% of what you borrowed. You will never repay more than double the amount borrowed on one loan — the cap holds through arrears, not just when everything goes to plan. This is deliberate: many high-cost lenders let default charges balloon past the principal, and we do not.
4. We try to agree a plan, not escalate
If a payment is missed and stays unpaid, we will try to reach you to understand what is going on and agree a way forward. We would much rather set up a repayment arrangement than let an account drift into deeper arrears. If your difficulty is more than a one-off, an arrangement or a hardship variation can reshape the payments around what the business can manage.
5. Extra protection if you have told us you need care
If you have told us you need extra support, that changes how we behave: we will not pass your account to a third-party debt collector while the flag is active, and freezes and reduced-payment plans become available without the usual checks. See how to tell us you need extra support.
The one thing that always helps
Tell us early. Asking for help, or telling us a payment will be late, is not reported to credit reference agencies as a default, and there is no penalty just for asking. Persistent arrears can be reported against the company to business credit reference agencies, which is one more reason to sort it out early. Free, independent advice is available from Business Debtline (0800 197 6026). Start any of this from our Forms & Requests page.
What is a Debt Management Plan and how does it affect my loan?
A Debt Management Plan, or DMP, is an informal arrangement that lets an individual make a single reduced monthly payment to a debt-advice provider, who shares it across that person's creditors. It is a tool for personal debt.
Your loan is the company's, not yours personally
Your Credicorp loan is to the company, for a business purpose. A director's personal DMP covers the director's own debts (a personal card, a personal loan, a phone bill) — it does not cover, and is not affected by, the company's loan with us. The two are separate.
If you, the director, are personally struggling
If your own finances are under pressure, a DMP through a free provider may help with your personal debts. The largest free, regulated providers in the UK are StepChange, PayPlan, Citizens Advice and National Debtline — none charges a fee. That is a personal matter and you do not need to tell us about it.
If the company is struggling to pay us
If it is the company that is finding the repayments hard, please tell us early — that is what makes the difference. The quickest way is the Hardship Variation Request form on our Forms & Requests page. Once we know, we will:
- pause normal collection contact while we agree a way forward;
- look at a payment arrangement, a short freeze, or a restructure of the remaining term;
- never apply a charge that is not in your Business Loan Agreement.
For free, independent help with business money worries, Business Debtline (businessdebtline.org, 0800 197 6026) advises the self-employed and small businesses at no charge, and the Federation of Small Businesses offers member support. If the company's position is serious, a licensed insolvency practitioner can explain formal options such as a Company Voluntary Arrangement. You are welcome to contact us at any time to talk it through.
What is a hardship variation?
A hardship variation is a change to the terms of the loan to reflect a genuine, often longer-term, change in the company's circumstances — for example a lost contract, a major customer going under, a seasonal downturn or an unexpected cost.
To consider a variation we will ask about the company's income and essential outgoings so any new arrangement is realistic and sustainable. Apply with the Hardship Variation Request form. Free, independent business debt advice is also available from Business Debtline (businessdebtline.org, 0800 197 6026).
What is a repayment arrangement and how do I set one up?
If keeping up with payments has become difficult, a repayment arrangement is a formal way to reshape what you owe into something the business can actually manage. Asking for one is sensible, not a black mark — and the earlier you ask, ideally before a payment is missed, the more room we have to help.
What an arrangement can look like
- A reduced-payment plan. You pay a smaller amount for a period while cash flow recovers, with the schedule adjusted around it.
- A short payment freeze. Where you need genuine breathing space, we can look at a payment freeze of 30 or 60 days. If you have told us you need extra care, a freeze can be arranged without the usual eligibility checks.
- A payment extension. If only a single due date is the problem, a short extension may be all you need — see can I get a payment extension.
- A hardship variation. For longer-term difficulty, a hardship variation changes the terms more substantially — see what is a hardship variation.
How to set one up
Start with the forms on our Forms & Requests page, or tell us through your portal or by phone. Please get in touch before the payment is due if you can. Telling us you are struggling, or asking about an arrangement, is not reported to credit reference agencies as a missed payment, and there is no penalty simply for asking. We will confirm any new schedule in writing so you know exactly where you stand. For the wider picture, see what to do if you are struggling to pay.
What an arrangement does not do
An arrangement reshapes your payments; it does not add hidden charges. There is no penalty-rate uplift for being in an arrangement, and the total cost of a single loan remains capped at 100% of what you borrowed — you will never repay more than double, arrangement or not. While we are working with you on an arrangement, and especially if you have asked for extra care, we will not pass your account to a third-party debt collector.
Free, independent help
Sometimes the most useful step is to talk to someone independent and free. Business Debtline (businessdebtline.org, 0800 197 6026) gives free, impartial debt advice to small businesses, and MoneyHelper (moneyhelper.org.uk) can help with personal money worries. Getting advice does not affect how we treat your account, and it often makes an arrangement easier to agree. If your circumstances mean you need us to do things differently, see how to tell us you need extra support.
Where can I get free, independent debt advice in the UK?
If money is tight, independent advice is often worth more than trying to work each creditor's process out one at a time. The right service depends on whether it is the business or you personally that is under pressure — and all the services below are free and confidential.
For the business
- Business Debtline — free, independent advice for the self-employed and small businesses, by phone and online (businessdebtline.org, 0800 197 6026). It is run by the Money Advice Trust.
- Federation of Small Businesses (FSB) — business support and advice for members (fsb.org.uk).
- A licensed insolvency practitioner — if the company's position is serious, an IP can explain formal options such as a Company Voluntary Arrangement, administration or, as a last resort, liquidation. You can find a licensed IP through the Insolvency Service or R3 (r3.org.uk).
- HMRC Time to Pay — if the pressure is a tax bill, HMRC can sometimes agree a payment plan (gov.uk).
For you personally
If it is your own finances rather than the company's, the leading free personal-debt services are StepChange (stepchange.org), Citizens Advice (citizensadvice.org.uk), National Debtline (nationaldebtline.org), PayPlan (payplan.com) and the government-backed MoneyHelper (moneyhelper.org.uk). None of them charges for advice.
What "free" really means
Every service above is funded so the advice is genuinely free to you — they do not take a slice of your payments. Paid-for debt firms exist, but a paid service will not get you a better outcome than a free one. If anyone asks for an upfront fee to set up a plan, treat that as a reason to switch to a free provider instead.
What we do at our end
If it is the company's loan with us that is the worry, you do not need our permission to seek advice — but a heads-up helps. Use the Hardship Variation Request form on our Forms & Requests page and we will hold collection contact while a plan is worked out. We would always rather agree something sustainable than see an account fall behind.