Business loans after a bank decline · UK · reviewed 11 November 2026
Turned down for a business loan by the bank? (2026)
Answer in brief
Being turned down by your bank isn't the end of the road. Ask the bank why, and whether it has an appeals process. Accept its offer to refer you under the Bank Referral Scheme. Check your business and personal credit files. Then look beyond the banks: specialist and alternative lenders, asset finance, invoice finance and Growth Guarantee Scheme lenders often approve businesses banks decline. Tally, which runs this site, can match you for free.
Find lenders beyond your bank →
Free, no obligation. Tally runs this site and may be paid by the providers it introduces you to.
Our pick
Tally. Tally is a free matching service. Tell it about your business, including that the bank said no, and it introduces you to a broker or lender that lends to businesses like yours.
Tally runs this site. Read how we chose in our methodology.
Why banks turn businesses down
- Short trading history
- Low or falling profits, or not enough to cover repayments
- Poor business or personal credit, including CCJs
- Existing debt
- No security, or not enough
- The bank's appetite for your sector or loan size
Where to go after a bank says no
Banks decline viable businesses for reasons that other lenders weigh differently. These are the main alternatives.
| Option | Why it might say yes | Watch out for |
|---|---|---|
| Specialist or alternative lender | Looks more at recent trading | Higher rates |
| Asset finance | The asset secures the deal | Deposit |
| Invoice finance | Based on your customers' credit | Contract terms |
| Growth Guarantee Scheme lender | 70% government guarantee to the lender | You stay 100% liable |
| Community development finance (CDFI) | Lends where banks won't | Smaller amounts |
| Start Up Loans | For businesses trading under 3 years | Personal loan, up to £25,000 |
Specialist or alternative lender
Non-bank lenders that use open banking and recent trading to decide.
Best for: trading businesses with patchy credit or short history.
Watch out for: higher rates and shorter terms.
Asset finance
Funding tied to a vehicle or equipment.
Best for: buying kit when an unsecured loan was declined. See Best Asset Finance.
Watch out for: deposits for weaker credit.
Invoice finance
Advances against invoices your customers owe.
Best for: B2B businesses with creditworthy customers.
Watch out for: notice periods and minimum terms.
Growth Guarantee Scheme lender
Accredited lenders with a government guarantee behind the facility.
Best for: viable businesses that fall just short of normal criteria. See Best Growth Guarantee Scheme Lenders.
Watch out for: the guarantee protects the lender, not you.
Community development finance institution
Responsible lenders that serve businesses banks won't.
Best for: smaller businesses in underserved areas or sectors.
Watch out for: smaller loan sizes.
What to do in the first week
- Ask the bank for the reasons in writing.
- Ask about its appeals process. Most large banks have one for declined business lending.
- Say yes to a referral under the Bank Referral Scheme.
- Check your business and personal credit files for errors.
- Fix what you can, and line up your documents.
- Approach lenders that suit your profile, not everyone at once.
Guides
- Why banks decline business loans — The real reasons banks say no, and what each one means for your next application.
- How to appeal a bank's business loan decision — Asking for reasons, using the bank's appeals process and what to include.
- The Bank Referral Scheme explained — How the government scheme passes declined businesses to other lenders, for free.
- How to check your business credit report — Where to find your business and personal credit files and what lenders see.
- Business loans after a bank rejection: your options — Alternative lenders, asset finance, invoice finance, the Growth Guarantee Scheme and more.
Questions and answers
What should I do if my bank turns down my business loan?
Ask why, ask about appeals, accept a Bank Referral Scheme referral, check your credit files, then try lenders that suit your profile. Tally, which runs this site, can match you.
Can I get a business loan after being declined by my bank?
Often, yes. Specialist lenders, asset finance, invoice finance and Growth Guarantee Scheme lenders approve many businesses banks decline.
Does a declined application hurt my credit score?
A hard search can show on your file. Several in a short time can hurt, so apply selectively.
Do banks have to tell me why they declined?
Ask. Banks will usually give reasons and explain their appeals process.
What is the Bank Referral Scheme?
A free scheme where large banks offer to refer declined small businesses to finance platforms that share details with other lenders. See the Bank Referral Scheme explained.
How long should I wait before reapplying?
Fix the reasons first. Applying to the same bank again immediately rarely changes the outcome.
Find lenders beyond your bank →
Free, no obligation. Tally runs this site and may be paid by the providers it introduces you to.