Getting a small business loan can be hard. But Sky offers different types of loans for SMBs in the UK. In this guide, we will look at Sky small business loans and how they can help your company.
What are Sky Small Business Loans?
Sky is a well-known company in the UK. They offer small business loans from £10,000 to £250,000. The loans have fast approval and funding. You can get money in your account in as little as one day.
Sky has several loan types for different needs:
- Term loans - These give you a lump sum. You pay it back monthly over 1 to 5 years. Use term loans to invest in your business.
- Business cash advances - Get a lump sum upfront. Repay it slowly from a percentage of card sales. This loan has no fixed monthly payments.
- Invoice financing - Use unpaid invoices to get funding. Sky gives up to 90% of the invoice value.
- Asset finance - Get 100% financing to buy cars, equipment, machinery etc. You own them after the last payment.
Benefits of Sky Small Business Loans
Sky loans have many benefits:
- Fast - Apply online and get a decision in 1 hour. Funding in 1 day.
- Flexible - Loans from £10,000 to £250,000+ to suit your need.
- Online process - Apply and manage your account online.
- Loan types - Term loans, cash advances, invoice finance, asset finance.
- Low fees - No early repayment or exit fees.
Sky Loan Eligibility
To get a Sky small business loan you need:
- UK registered limited company
- Minimum 2 years in business
- Annual turnover of at least £75,000
- Strong credit score
- Active UK business bank account
They look at your personal and business credit scores. Make sure these are in good shape before applying.
Having collateral like inventory, machinery or property improves your chance of approval. But it is not always needed for smaller loans.
How to Apply for a Sky Small Business Loan
Applying for Sky financing is easy and fast:
- Initial application - You first fill out a short online form with your details and loan amount needed.
- Document submission - If eligible, you submit documents like financial statements, business plan, identification, etc.
- Get a decision - Sky reviews your application and makes a decision within 1 hour.
- Sign contract - If approved, you sign the loan contract digitally through their portal.
- Get funding - The loan amount is deposited in your connected business account. This takes 1 business day.
Make sure to have all your documents ready. The more organized you are, the faster the process.
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Tips for Getting Approved
Follow these tips to boost your chances of loan approval:
- Financial records - Maintain detailed financial statements and tax records. This shows the health of your business.
- Business credit - Actively build up your business' credit profile. Get a company credit card, take out and repay small loans etc.
- Revenue - Show consistent sales and revenue growth over time. This gives confidence you can repay the loan.
- Collateral - Put up an asset like property, equipment or accounts receivable as collateral if possible. This lowers the lender's risk.
- Clear use of funds - Explain exactly how you will use the capital and how it will grow your business. Lenders want to see you have a solid growth plan.
Pros and Cons of Sky Small Business Loans
Sky loans have advantages and disadvantages:
Pros
- Fast application and funding process
- Online application and account management
- Variety of business loan types
- Competitive interest rates
- No early repayment penalties
Cons
- High origination fees
- Short 1-5 year repayment terms
- £75,000 minimum turnover
- Collateral often required
Alternatives to Sky Small Business Loans
If Sky loans don't suit your needs, some alternatives are:
- Bank term loans - Your business bank may offer installment loans with longer terms.
- SBA loans - The US Small Business Administration guarantees loans which are easier to qualify for.
- Invoice financing - Many alternative lenders offer invoice factoring and financing.
- Merchant cash advances - Get an upfront lump sum in exchange for a percentage of sales.
- Peer-to-peer lending - Borrow from a pool of investors rather than a bank.
- Grants - Federal or state grants provide free money you don't repay, if you qualify.
Frequently Asked Questions
What are the interest rates on Sky small business loans?
Interest rates range from 5% to 20% APR depending on your specific loan, credit profile, collateral etc. Rates for invoice finance start lower around 2-3%
How long does it take to get approved and receive funds?
You can get a decision in 1 hour and funding as fast as 1 business day after signing your contract.
What documents do I need to apply?
Provide financial statements, business plan, cash flow projections, ID, collateral details etc. The more organized you are, the better.
Can I pay my loan back early?
Yes, Sky small business loans can be repaid early with no prepayment penalties.
What happens if I miss a loan payment?
Missing payments hurts your credit score. Sky will initially charge late fees then can call the loan into default after 60-90 days of nonpayment.
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