Credit4 review: flexible facilities and business loans for SMEs

Credit4 is a specialist SME lender that keeps its range deliberately simple: three products, from a small revolving facility through to secured loans of up to £250,000, all underwritten by people rather than an algorithm. Credit4 is one of the lenders on our panel, and as an independent broker we can compare its offer with other unsecured, revolving and secured lenders before you choose.

01About Credit4

Credit4 Limited is registered in England and has its office in Victoria, London. It is an independent lender rather than a bank, and it works both directly with businesses and with brokers through a dedicated broker hub.

Its main message is about how decisions are made. In its own words, its decisions are made by humans not machines, so the underwriter listens to the story behind the numbers. That can help a business whose bank statements or accounts need some explanation, such as a lumpy year, a one off loss or a recent change in direction.

Smart Funding Solutions is an independent broker and is not part of Credit4.

02What Credit4 funds

Credit4's website sets out three products:

The Dual Growth product is the most distinctive. Many lenders make you choose between a fixed loan and a revolving line. Credit4 lets you take part of the money as a term loan for a planned investment, such as a new hire, a fit out or a marketing push, while keeping the rest as a facility for day to day swings.

The secured product lends up to 80 per cent loan to value and can take a first or second charge over the guarantor's property, which makes it relevant to directors who own a home with equity but want more than an unsecured lender will offer.

03Who Credit4 suits (and who it may not)

Credit4 tends to suit established SMEs with steady trading that need between £15,000 and £250,000 and want a person to look at their case. The Dual Growth product fits growing businesses that need both a lump sum and ongoing headroom, while the secured product suits homeowner directors who want a larger amount over up to five years.

Picture a wholesaler that wants to open a second unit: a term loan could cover the fit out, while a facility alongside it absorbs the extra stock in the first few months. That is the kind of two part need the Dual Growth product is designed around.

It is less likely to suit owners who do not want to give a personal guarantee, since Credit4 says all its products need guarantees from directors or principals. Very small needs below £15,000, very large ones above £250,000, and businesses that need money within hours may be better served elsewhere.

04What Credit4 looks at

Typical information for these products includes:

• Recent business bank statements and, for larger amounts, filed and management accounts.
• Details of the directors, who will provide personal guarantees, and credit searches on them.
• Details of existing borrowing, including other loans and advances.
• For secured funding, details of the property, its value and any mortgage already on it.
• An explanation of what the money is for and how it will be repaid.

This is a general guide for the product types rather than a list published by Credit4.

05Pros and cons

Pros

• Human underwriting, so context and explanations count.
• Dual Growth combines a term loan and a facility in one package.
• Secured option can use a first or second charge on a guarantor's property.
• Clear, published size and term ranges for each product.

Cons

• Personal guarantees are required on every product.
• The revolving facility on its own is fairly small.
• Maximum of £250,000, even with property security.

06Applying through a broker vs going direct

Credit4's mix of products is useful, but the right answer depends on how you want to repay and what security you can offer. We compare revolving credit facilities, unsecured business loans and homeowner business loans across the market, present your case once and approach the lenders most likely to fit. If a personal guarantee is unavoidable, our page on personal guarantee insurance explains how some owners protect themselves.

It is free to enquire; any broker fee is disclosed separately before you proceed. Start with Instant Quotes to compare lenders in minutes.

07Alternatives to Credit4

• iwoca: a well known revolving credit line for smaller, frequent working capital needs.
• Fleximize: flexible unsecured and secured loans that can suit growing SMEs wanting longer terms.
• Capify: a better fit when speed is the priority, with same day unsecured funding.