2 min read
The cost of over-borrowing
Every extra pound borrowed carries interest and a bigger repayment, whether or not you deploy it. Padding a loan “just in case” quietly raises your cost of borrowing and your repayment burden.
Sizing it right
Work out the actual funding gap from your forecast and borrow to that. If you want a shock-absorber, a standby facility you draw only when needed beats a bigger term loan you pay for from day one. Check the numbers with the affordability calculator.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. A flexible facility gives you headroom on demand without paying interest on money you are not using. See business loans or apply online.
Frequently asked questions
Should I borrow extra as a safety margin?
Not as a bigger term loan — you pay interest and a larger repayment on idle cash. A standby facility you draw only when needed is the cheaper safety margin.
How do I size a loan correctly?
Calculate the real funding gap from your forecast and borrow to that. Avoid padding the amount, which just raises cost and repayment risk.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.