A common question when arranging business finance is whether directors are personally on the hook. With Credicorp, the answer is clear: we lend to your company, and we do not take personal guarantees from directors.
What this means
The loan is a commitment of the limited company or LLP that borrows it, not of the individuals who run it. Your directors are not asked to sign a personal guarantee that would put their own assets behind the company's borrowing.
- The borrower is the company, not the director
- No personal guarantee is required from directors
- The facility sits on the company's books
What we still need from directors
While there is no personal guarantee, an authorised company officer must sign the agreement on the company's behalf, and we carry out identity and verification checks as part of responsible lending. Directors are expected to ensure the company manages the loan properly.
Why we structure it this way
Lending to the company keeps the borrowing where it belongs, in the business. Because Credicorp is an exempt business lender outside the FCA consumer-credit regime, the Financial Ombudsman Service and FSCS do not apply, which is one reason we deal only with companies and LLPs.
We never lend to individuals or sole traders.
See also: Why don't you take a personal guarantee from directors?, No personal guarantee: what it means for directors, Why Credicorp doesn't take personal guarantees from directors.