Business finance options comparison checklist

Match the product before you shop the rate

The most common borrowing mistake is comparing rates across products that do entirely different jobs. A term loan and a revolving facility can have similar headline costs yet suit opposite situations. So the first decision is not "who is cheapest" but "what shape of money does this need actually require". Get that right and the cost comparison becomes meaningful; get it wrong and the cheapest option can still be the worst fit.

This checklist scores the four mainstream options against your situation, then sends you to compare like-for-like cost only among the ones that genuinely fit. Built for UK limited companies, it complements how to compare finance options with a structure you can copy and tick.

The four options at a glance

Copy this table and note which row sounds most like your need:

Option	Best for	Shape of money
Term loan	A one-off, known cost	Lump sum, fixed repayments over a set term
Revolving credit facility	Fluctuating or recurring working-capital needs	A limit you draw on and repay repeatedly
Invoice finance	Cash tied up in unpaid B2B invoices	Advance against your debtor book
Asset finance	Buying equipment or vehicles	Spread the cost over the asset's working life

A short-term business loan covers the first row; the revolving Credicorp Flex facility covers the second.

Score each option against six criteria

For every option that looks plausible, score it 1–5 against these criteria, then add up the columns:

• Purpose fit — does the shape of money actually match what you need it for?
• Total cost — total repayable plus every fee, not the headline rate. Use the true cost of borrowing calculator.
• Speed — how quickly funds arrive versus when you need them.
• Flexibility — can you repay early, redraw, or flex the amount?
• Security & guarantee — is a charge or personal guarantee required? Many directors rule out a personal guarantee here.
• Affordability — does the repayment fit your cash position on an ordinary month? Check with the affordability calculator.

Read the score, not just the rate

The highest total usually wins, but weight the criteria that matter most to you before you total them. A business bridging a known peak should weight purpose fit and speed; a director protecting personal assets should weight the security and guarantee line heavily, even at a slightly higher cost.

Two traps to watch. First, a low rate on the wrong product still scores badly on purpose fit — don't let price override shape. Second, compare total repayable, because a longer term can mean a lower monthly payment but more cost overall. The loan comparison calculator lines up competing offers on the same basis.

Sense-check before you apply

Before committing to the winning option, run three final checks. Is the amount right — enough to do the job without over-borrowing? Is the term sensible — repayments falling when you generate cash, not in your quietest month? And are the figures behind your application in order, so the decision is fast and well-priced?

The loan-readiness checklist gets your numbers and filings straight. Note that Credicorp lends to the limited company with no personal guarantee, which can shift the security line of your scoring. This is educational information to structure a decision, not financial advice — confirm specifics with each provider and your accountant.