How to finance a restaurant fit-out without draining cash flow
The safest way to fund a restaurant fit-out is to match each cost to the right finance: asset finance or leasing for kitchen equipment, furniture…
Hospitality
Restaurant loans to refit, equip and grow your restaurant
How restaurants fund refits, kitchen kit, second sites and quiet months: unsecured loans, card-based advances, asset finance and what lenders look for.
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- Amount
- From £10,000 to £10 millionLarger amounts through secured, property and asset-based finance
- Typical uses
- Refits, kitchens and quiet monthsSecond sites and tax bills too
- What lenders review
- Card takings and marginsBank, card terminal and delivery statements
- Common structures
- Loans, card-based advances, asset financeCompared across 300+ lenders
In short
The best restaurant finance depends on what you are paying for.
Kitchen equipment and fit-out items usually suit asset finance; a refit or marketing push suits an unsecured loan; seasonal card-heavy trade may suit a merchant cash advance; and buying premises needs a commercial mortgage. Lenders judge you mainly on card and bank statements, margins, lease length and whether repayments still work in your quietest month.
- Refurbishment
- Kitchen equipment
- Working capital
- Marketing
- Expansion
“He is fair and always gives advice that is in the best interest of his clients.”
About restaurant loans
Restaurant loans are finance for restaurants, cafés, takeaways and other food businesses.
They can pay for a refit, new kitchen equipment, stock, staff, marketing, a second site or the purchase of your premises. The right product depends on what you are funding, how long you have traded and how your income arrives.
Smart Funding Solutions is a broker, not a lender. We approach lenders with an appetite for hospitality, which matters because some lenders limit or avoid restaurant lending while others specialise in it. This page is part of our hospitality business loans section.
Funding needs
What restaurants use finance for
Refurbishment
new furniture, décor, lighting, outdoor seating and signage.Kitchen equipment
ovens, extraction, refrigeration, dishwashers and coffee machines.Working capital
wages, suppliers and stock, especially in quieter months.Marketing
campaigns, a new website or online ordering.Expansion
a new site, extra covers, a delivery kitchen or a new service such as catering.Premises
buying the lease or freehold on your building.Tax bills
spreading VAT or corporation tax payments.
Quick enquiry
Prefer a quick call back?
Not ready for the full application? Leave a few details and a broker will call you to talk it through. It is free, with no obligation.
- One short conversation, no paperwork yet
- Whole-of-market search across 300+ lenders
- Or call us on 01244 267694
A transaction we arranged
£38,000
£38K further advance, repaid as a share of card sales.
An existing hospitality client needed more capital. The lender sized it on current card takings and the repayments already running.
Read the transaction- Sector
- Hospitality
- Structure
- Further advance, percentage of sales
- Outcome
- £133,000 across 4 facilities
Types of restaurant finance
-
Unsecured business loans
Learn moreA lump sum repaid in fixed instalments without a charge over property. Lenders usually require a personal guarantee from directors. Suits refits, marketing and general growth. See unsecured business loans.
-
Merchant cash advance
Learn moreAn advance repaid as an agreed percentage of your card takings. Repayments rise and fall with your sales, which can help seasonal restaurants. It can cost more than a term loan, so compare the total repayable. Read about the merchant cash advance.
-
Asset and equipment finance
Hire purchase or leasing spreads the cost of kitchen equipment and fit-out items, with the equipment as security. It keeps cash and other credit lines free.
-
Revolving credit facility
Learn moreA credit limit you draw on and repay as needed, useful for stock, bills and short gaps in cash flow.
-
Secured loans and commercial mortgages
Borrowing secured on property, used to buy premises or raise larger sums over longer terms.
-
Funding a new opening
New restaurants have fewer options because there is no trading record. Government-backed Start Up Loans, personal investment and asset finance are common starting points, and some owners use reward crowdfunding or bring in an investor. Our guide to getting a loan to start a restaurant covers deposits, business plans and first-time owners in detail.
The operating cycle
Where finance fits into your restaurant
Cash leaves the business at every stage before it comes back. Each stage below is a point where the right facility can carry the gap.
-
01 Fit-out
Kitchen, extraction, furniture, lighting and signage.
Asset finance → -
02 Stock
Food and drink bought ahead of every service.
Working capital → -
03 Staffing
Wages paid on time, whatever the week’s takings.
Working capital → -
04 Launch
Marketing and opening costs before trade settles.
Unsecured loans → - 05
Card sales
Takings arrive daily through the card terminal.
Merchant cash advance → - 06
Tax
VAT quarters can land on top of a quiet month.
VAT loans → - 07
Expansion
A second site, extra covers or a delivery kitchen.
Secured loans →
Funding needs
Funding options for restaurants
Choose the need, and we’ll show you how lenders usually structure it.
Explore this section
In this section
More detail on specific needs within this topic.
How to get a loan to start a restaurant: a beginner's guide
To get a loan to start a restaurant you usually need a detailed business plan with realistic forecasts, some of your own money in the project…
How restaurant cash flow shapes borrowing
Restaurants take money daily, mostly by card, but pay out in lumps: weekly wages, supplier accounts for food and drink, rent quarters and VAT. Margins depend heavily on food and labour costs, and trade moves with the seasons, the weather and local events. Delivery platform income usually lands in periodic payouts rather than on the night. Lenders look at all of this through your bank and card statements, so a restaurant with steady covers and controlled costs is a much stronger borrower than one with high turnover but thin margins.
When to invest in your restaurant
There are two common moments. When trade is strong and your current site is at capacity, finance can help you build on that success with more covers, a refit or a new location. When trade is slipping because of a tired interior, an outdated menu or new competition, investment can help turn things around, provided the plan is realistic and repayments stay affordable.
Underwriting
What lenders look at
01
Trading history
established restaurants have more options; new openings rely more on the owners' experience and plan.
02
Turnover and card takings
bank and card terminal statements show how consistently money comes in.
03
Profitability and affordability
whether the business can meet repayments, including in slow months.
04
Credit profile
of the business and its directors. Adverse credit reduces options but does not always rule finance out.
05
Experience
a track record in running or managing restaurants strengthens an application.
06
Business plan
for start-ups, expansions and larger sums, realistic forecasts and a clear use of funds.
07
Security
property, equipment or a personal guarantee, depending on the product.
Checklist
Documents lenders usually ask for
- Recent business bank statements and card terminal statements
- Delivery platform statements, if takeaway is a meaningful share of sales
- Latest accounts and management figures, ideally showing food and labour cost percentages
- Your lease, including the remaining term and any break clauses
- Quotes for equipment or refit work
- A business plan and cash flow forecast for new sites or larger projects
A common mistake is underestimating the full cost of a project: a refit also means lost trading days, re-launch marketing and extra stock. Build those into the amount you ask for.
Comparing offers
Rates depend on your credit profile, trading figures, the product, the term and any security. Compare offers on the total amount repayable including fees, not the monthly payment alone. For a restaurant, also test each offer against your quietest month: a merchant cash advance flexes with takings, whereas a fixed loan repayment stays the same in January as in December. Check early repayment charges and exactly what any personal guarantee commits you to.
How the process works with us
- Tell us what you want to fund and share recent bank and card statements.
- We explain the realistic options for your trading record and plans.
- We approach suitable lenders and handle their questions.
- We compare offers with you, including how repayments behave in quiet months.
- The lender makes the final decision; decisions can come within a few working days once it has everything it needs.
It is free to enquire, and any broker fee is disclosed separately before you proceed. Planning a bigger project? Read our guide to financing a restaurant fit-out or our kitchen equipment finance guide.
FAQs
Questions clients ask
Are there government-backed loans for restaurants?
Restaurants can apply for loans under the Growth Guarantee Scheme, which the British Business Bank delivers through accredited lenders, and new restaurants may be eligible for a government-backed Start Up Loan. Each lender makes its own decision and scheme details can change, so check the British Business Bank website for current availability.
Can I get a restaurant loan with bad credit?
Adverse credit reduces your options but does not always rule out restaurant loans. Lenders weigh the business's and directors' credit history alongside card and bank statements, margins and affordability, so steady takings can help offset an older, explained problem. Card-based products such as a merchant cash advance focus more on recent takings, though they can cost more. Expect questions about any defaults or judgments. Our guide to getting a business loan with a CCJ explains more.
Does the length of my restaurant lease affect what I can borrow?
Yes, the remaining lease term and any break clauses matter, particularly for refits and equipment fixed to the premises. Lenders are cautious about lending over a longer period than you are secure in the building, because a restaurant that loses its site loses its income. If your lease is close to its end, agreeing a renewal before you apply can strengthen the case. Our guide to financing a restaurant fit-out covers this in more detail.
Can a sole trader get a restaurant loan?
Yes, sole traders and partnerships running restaurants can borrow, although some lenders only work with limited companies. Lenders look at bank and card statements, tax returns and the owner's credit history. Borrowing of £25,000 or less by a sole trader or a partnership of two or three partners can be regulated consumer credit, which brings extra protections and affects which lenders can offer it. Our page on sole trader loans explains the options.
How quickly can I get a restaurant loan?
A lender can make a decision within a few working days in straightforward cases, once it has everything it needs. Equipment finance and card-based funding tend to move faster, while secured loans and commercial mortgages take longer because of valuations and legal work. Having recent bank and card terminal statements, delivery platform statements, your latest accounts and your lease ready speeds things up. Some lenders may use a soft search early on, and a full credit search usually happens on application.
Relevant transactions
See more related deals More deals like this
Three restaurants. One group. A £57,150 renewal.
We have arranged funding for all three of a restaurant group's venues, including a £57,150 renewal for one of them.
Renewal facilityRead the transaction
£9K, sized to the business.
A smaller working-capital need for an independent food business, met with a proportionate revenue-based facility.
Revenue-based facilityRead the transaction
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What our clients say
“Simon was fast, kept us updated at all stages and was a real pleasure to work with on our asset finance. I highly recommend this company: excellent service all round.”
“Spoke with Simon, who managed to get me the loan I needed promptly. The whole process was very smooth and was completed within a few days.”
“Getting a business loan can feel like a bit of a minefield, but everything was broken down for me in great detail. Will use again in the future!”
“Simon was a pleasure to deal with and helped us find a business loan that matched our growth goals and future expansion plans.”
“I couldn’t source funding for my business, but the team got in touch within an hour and had it sorted within 24 hours. Fantastic service, and I would definitely use them again.”
Why businesses choose Smart Funding Solutions
- Access to 300+ lenders
- Personal broker support
- No obligation discussion
- Free to enquire