Bank loan

Packaged by the high street banks under various titles, a business development loan is an injection of cash to be repaid over a term – typically two to five years and occasionally longer. Bankers dislike “hardcore” overdrafts (i.e. those accounts that are permanently overdrawn) and will press for them to be switched to a loan.

Smaller businesses are much more likely to be offered a loan than an overdraft unless the need is very obviously short term. In many cases the bank is likely to seek outside collateral security.