Short-term business finance is a tool, and like any tool it can build or break depending on how it is used. In a squeeze the crucial question is what kind of gap you are filling.
A timing gap: finance can help
If the money is genuinely coming — a confirmed contract, an invoice you will be paid on — short-term finance can bridge the wait sensibly. The cost is known: 0.25% per day, a one-time £5 fee, capped at 100% of what you borrow, with no personal guarantee.
A structural hole: finance makes it worse
If income has fallen and is not coming back, borrowing to cover the gap only postpones and enlarges the problem. Here the answer is fixing the business — cutting costs, rebuilding revenue — not more debt.
Be honest about which it is
The single most important thing is to diagnose the gap correctly. Take independent advice if you are unsure — Business Debtline gives free, confidential debt advice to small businesses and the self-employed at businessdebtline.org or on 0800 197 6026.
See how a short bridge can work when the gap is genuinely temporary in the guide below.
We lend only to UK limited companies and LLPs, and the loan is to the company with no director personal guarantee. As business finance outside the consumer-credit regime, it is not covered by the Financial Ombudsman Service or FSCS.
See also: How short-term finance can bridge a temporary cashflow gap, How do we avoid making difficulty worse with quick-fix borrowing?, Should I borrow more to cover a missed payment?.