Funding Bay Blog

Best lenders business loans options for e-commerce in the UK

The e-commerce market in the United Kingdom is best described as already being significant in size, whilst also still growing rapidly. Who are the best lenders business loans options for e-commerce in the UK?

These e-commerce businesses naturally need access to flexible business finance to fund their plans for growth and expansion. So, what can some of the UK’s leading business finance lenders offer e-commerce businesses? 


Iwoca specialises in providing short-term loans to smaller e-commerce businesses. 

Its simplest product might be the Flexi Loan, where you could borrow anything between £1,000 and £200,000 over a term of 12 months. Interest rates start at 2% per month, and you would make repayments of capital and interest every month during the loan term. 

Its Merchant Cash Advance product could be perfect for many e-commerce businesses, whose customers nearly always pay using a debit or credit card. With this product, you don’t need to make regular monthly repayments, and instead repayments are collected automatically when customers make card purchases – a small percentage of each transaction amount goes towards repaying the loan. Iwoca’s Merchant Cash Advance allows you to borrow up to £50,000 or two months’ turnover, whichever is lower.  

Iwoca also offers the Government’s Recovery Loans. These are for businesses that have been affected financially by Covid-19. You can borrow between £25,000 and £750,000 and will repay the loan amount plus interest (which might be around 7% per annum) over five years. Again, if you wish to pay off the loan early, there will be no fees charged for this. 

It promises to make lending decisions within one working day and do not charge fees if you wish to repay early. 

Its website has a user-friendly loan calculator so it’s easy to obtain an indicative quote without going through the application process. 

Merchant Money 

Merchant Money has been lending to small businesses in e-commerce and other sectors since 2013. It offers secured loans, unsecured loans and merchant cash advances. 

Its secured loans allow you to borrow up to £500,000, and you can choose a repayment term of between three months and three years, to fit in with your business needs. The security for the loan can be either a commercial property, or a residential property owned by a director or shareholder. The interest rate could be anything between 1.75% and 3%. 

Merchant Money’s unsecured loans work in a similar way to the secured loans, except in this case you won’t need to provide any security for the loan. The maximum amount you can borrow on an unsecured basis with this lender is £150,000, with interest rates varying between 1.5% and 3%. 

Merchant Money also offers merchant cash advances for businesses that receive £5,000 or more in revenue from card payments every month. If this applies to your business, Merchant Money might be prepared to lend you 100% of your average monthly card transactions, up to a maximum of £500,000. Its ‘factor rates’ start from 1.15, and this rate determines the amount you repay, so if your factor rate was 1.2 and you borrowed £100,000, you would need to repay £120,000. Its website also gives an example of how the repayments would work; and says that if a customer spent £100 on their card, Merchant Money might take £12 towards repayment of the loan, allowing you to keep the other £88. 

Merchant Money says it can provide funding within 24 hours. 

You should be aware that it asks for a personal directors’ guarantee on all of its business loans. 


LendingCrowd is a fintech lending platform that seeks to connect UK small and medium sized businesses with suitable lenders. 

With LendingCrowd, you can borrow between £5,000 and £500,000 and repay it over a term ranging from six months to five years. It offers very flexible repayment arrangements – not only can you repay early without penalty, but it’s also easy to make one-off or regular overpayments, should you have surplus cash available. 

As with many specialist small business lending platforms, LendingCrowd says it will endeavour to make a decision on your application within 24 hours. 

Find the best lender with FundingBay 

These are just three of the many companies who might be able to offer you a business loan.

At FundingBay, we have access to more than 250 lenders, from well-known high street banks to smaller independent lenders. We have extensive experience in helping businesses like yours to find the right lender and the right product for their needs and circumstances. 

See funding options

Further Reading