What is an Unsecured Business Loan?

by | Feb 26, 2019 | Business Management, Capital Raising, Small Business Loans

Sometimes, businesses need a quick injection of cash. It can help them to grow, improve and generally move in the right direction. If you feel that secured business loans represent too much risk and you’re instead looking for a business loan that’s safer, an unsecured business loan is most likely what you’re looking for. We offer them to all kinds of businesses here at Bizzloans, so we’re happy to help you too.

If you’re not sure about whether an unsecured business loan is right for you, we’re going to talk more about what they are and what you should know about them before taking one out. It’s always best to understand the type of loan you’re taking out before you do so. Read on now and find out what an unsecured business loan is and whether they’re right for your business.

What Does Unsecured Mean?

An unsecured loan doesn’t have any collateral involved in the process. This means that other factors are used in order to decide which businesses are granted loans and which aren’t. Secured loans have a costly asset attached to them which acts as the security for the lender in the event of the borrower not being able to repay the loan.

None of that stuff applies when your loan is unsecured. It means that you don’t have to put an asset at risk, which is safer for the business. It makes the process of accessing financing less scary and less risky in many ways and that’s why so many businesses choose these types of loans over the alternatives like secured loans.

The Benefits of an Unsecured Business Loan

There are lots of good reasons to take out an unsecured business loan if your business needs a source of cash in order to achieve everything you want it to. Here are some of the main benefits of this type of loan over the alternatives that you should be aware of.

A Fast Application Process When you take out a secured business loan, the application can be quite long as the collateral is sorted out. That takes some time and it drags on for longer than most companies might like. Businesses mostly just want to get access to the money they’re applying for. One of the good things about taking out an unsecured business loan is that the application process is much faster. You can normally get the application process over with very quickly, and a lot of trouble and annoyances are avoided completely.

A Quick Response

As well as the application process being very fast, the response times associated with unsecured business loan applications are a lot quicker too. It’s easier for lenders to assess an application, look at all the components and see whether they want to lend the money to the borrower or not. Your business won’t have to wait around for a long time before finding out whether you’re going to be accepted for that loan you applied for or not and that’s got to be a major benefit over the alternatives.


No Security Necessary

The main thing that makes unsecured loans more attractive than secured loans is the fact that they’re no security. It might be an obvious thing to highlight but it clearly matters. You won’t be weighed down by the pressure and worry associated with having collateral hanging over you and potentially being lost to the lender if you fail to make repayments. If you don’t want to take the risk of losing your collateral, you just need to opt for an unsecured loan instead. It’ll allow you to avoid any risks associated with secured loans.

Build Up Your Future Credit Score

By taking out a loan and then paying it off on time, you will help to build or repair your credit score. Many companies are dealing with poor credit, but by taking out an unsecured loan with a lender that is happy to lend to companies with poor credit, you can start to turn the situation around. Meeting regular repayment deadlines shows the world that you are able to stay on top of your financial obligations and pay off the money you owe, and that will only help your business going forward.

Why Your Business Might Want to Take Out an Unsecured Loan

There are lots of reasons why your business might take out a loan, as well as reasons not to. You shouldn’t take out a loan to cover running costs, but if you want to do other things, such as the things we’re going to discuss below, an unsecured business loan can be ideal.

Grow and Expand

Most entrepreneurs have big plans for their businesses. They want to ensure that their business is one that’s got a bright future. So if the time has come for you to grow and expand your business, you should think about whether taking out an unsecured business loan might help you to do that. It could be exactly what you need to get your business moving in the right kind of direction. It takes money and investment to grow your business and a loan might just be the ideal solution.

Take on More Clients and Customers

If your business doesn’t currently have the resources to deal with more customers and clients, it could be time to scale things up. However, that’s something that costs money, whether you like or not. Taking out an unsecured business loan could help improve the resources your business has available. It could mean hiring more people so that you have the human resources needed to take on more clients and make more customers happy. The loan will cover the costs associated with doing that and it’ll pay for itself if you’re able to improve your profits as a result.

Fund a New Marketing Campaign

Maybe it’s the case that attracting new customers to your business is where your problems lie. It’s not always easy to get your voice heard and make people aware of why they should be taking notice of your business. An unsecured loan could be used to fund a new marketing campaign that gets your message out there and makes more people interested in your business and what it’s offering. So if you have an idea for a marketing campaign that you think might work but you don’t have the financing for it, consider a loan.


The chance to improve your business in the many ways mentioned above offers you a real opportunity that you might want to grasp. Secured loans can offer the same access to financing but come with more risks to your business. With an unsecured loan, you can reap all the rewards that come with having the cash to invest in your business without having to worry about the risks adversely affecting the business in the future. The chance to improve with fewer risks attached to that chance should not be ignored or dismissed.

The Requirements for Getting an Unsecured Business Loan

man using his laptop displaying unsecured business loan

There are some requirements you’ll need to be aware of before you take out an unsecured business loan. These aren’t too harsh or restrictive at all, but they are important.

24 Month Limit

When you take out an unsecured loan from Bizzloans, you have to pay the loan back within 24 months. That’s the maximum repayment term that’s on offer. Of course, that won’t be a problem for the vast majority of businesses out there. It’s important that you look at the finances closely and decide for sure that this is something your business is going to be able to do. You’ll have a chance to do this when you get a quote from us, so you’ll know exactly what you’re signing up to.

Business Bank Statements

To ensure your business is in a financial position to take on a loan of the size you’ve applied for, you’ll need to simply submit your business’s bank statements. This allows us to ensure that we lend responsibly and don’t burden you with a debt that is too much for you to take on. It’s in both your best interests and ours that you’re able to handle the loan that you take on.

Photo ID

To ensure everything is correct and proper, and you are who you say you are, you have to submit a photo ID. This is common practice and ensures that all financial transactions are above board and in order. It’s very easy to do and needn’t be a headache for you. Once we are satisfied with your application, you’ve provided the bank statements and we’ve checked your ID, it won’t be long before you have access to the loan you applied for.

Getting an unsecured business loan for your company could be just what it needs right now. It’s a much safer option than taking out a secured loan and you’ll be accepted much faster. Don’t hesitate to get in touch with us here at Bizzloans if you’re thinking of taking out an unsecured business loan.


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