Enhanced CapEx Term Loan: What’s it all about?

• Shawbrook has increased the maximum loan size and term on its CapEx Term Loan product
• Learn about the benefits of a CapEx Term Loan 

We’ve made some exciting enhancements to our award-winning CapEx Term Loan.

This article delves into the changes and the benefits of a CapEx Term Loan compared to other finance solutions available.

What is a CapEx Term Loan?

A CapEx Term Loan is an unsecured business loan tailored for specific capital expenditure investments. It’s ideal for businesses that need quick access to cash to grow by acquiring tangible or intangible assets, as well as completing refurbishments and fit-outs, without impacting their cash flow.

What changes have been made?

1. Increased Maximum Loan Size – We have upped our maximum loan limit from £100k to £250k, enabling us to support even more investments. We have seen a significant demand for refurbishment and fit-out requirements, and this increase means we can support clients with bigger projects.
2. Increased Maximum Term – Previously capped at 3 years, we can now provide loans with terms up to 5 years. This offers greater flexibility for clients looking to spread the cost of their investments over a longer period.

What are the benefits of a CapEx Term Loan?

CapEx Term Loan is designed to provide fast and fuss-free finance to support your clients’ growth ambitions. The main benefits are:

Quick Access to Cash – Two of the standout features of the Shawbrook CapEx Term Loan are its quick time-to-decision and fast time-to-cash. Traditional asset finance often requires asset inspections and vendor reviews, which can delay funding. In contrast, the CapEx Term Loan offers:

• Fast auto-decisions
• Same day-payout (where all required information is provided by noon once approved
• A slick digital process
• Minimal upfront information requirements
• No supplier approval needed
• Payment directly to the customer
• A consistent level of service

This efficiency is crucial for businesses needing immediate access to funds to capitalise on growth opportunities.

Flexibility in Funding - Unlike asset finance, which is typically restricted to tangible assets like machinery or vehicles, the CapEx Term Loan caters to tangible and intangible capital expenditures. This includes investments in IT equipment, software licenses, office refurbishments, and a diverse range of growth-oriented projects. This flexibility allows businesses to allocate funds where they are most needed, without the constraints of asset-based collateral. 

What other finance options are available?

• Asset Finance – While asset finance (Hire Purchase and Finance Lease) may be suitable for your clients’ needs, it can mean an elongated credit process, with multiple information requirements which are not required for CapEx Term Loans.

• Unsecured Business Loans – There are of course a range of business loans on the market, but these are often targeted at broader, or more generic business needs, which can come at a higher cost. By using a loan designed to support specific business growth initiatives, customers may be able to access a more competitive rate.

• Business Cash Reserves – While some businesses may wish to dip into their cash reserves to fund crucial investments, others may prefer to maintain cash reserves and consistent cash flow for other business-critical costs. That’s where a suitable finance product can be beneficial.

• Personal Finances – 71% of SME decision-makers reported using their personal finances to fund business growth this year, up from 68% in 2023¹. This trend suggests that many businesses may be unaware of the financing options available, underscoring the crucial role brokers play in today’s financial landscape.

¹Research: The financial strategies of UK SMEs | Shawbrook