Pay as you grow loan

Pay as you grow is a flexible funding arrangement that allows a business to manage loan payments in line with their revenue. It can help businesses grow in a controlled way and survive challenging trading conditions.

  • Apply in minutes
  • No paperwork, just link your account to Open Banking
  • Borrow up to £50,000
  • If sales slow down, so will your repayments
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Applying won't affect your credit score

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Loved by over 90,000+ small businesses since 2012

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What is pay as you grow?

As a small business owner you’ll face different challenges as your business grows – one of the main ones being cash flow. A pay as you grow loan can help you stay afloat and improve financial planning and control.

In September 2020, the Chancellor of the Exchequer announced a government-sponsored Pay As You Grow (PAYG) scheme to help businesses repay the Bounce Back Loans they took out during the pandemic.

With a traditional loan, you’ll meet stricter terms when it comes to repayment deadlines, the amount that has to be repaid and the interest. With pay as you grow, the terms can be more generous. You’re often able to make flexible payments that match your business’ growth and revenue. You can also avoid heavy interest rates and fees. This can help you keep a tight rein on costs when margins are slim.

With an iwoca Revenue-Based Loan, you can access funds that mirror your business’ turnover, and stay in control of finances as trading conditions change.

The benefits of a pay as you grow loan

Flexibility and financial security are the main benefits of a pay as you grow loan. It’s a funding model that’s particularly suited to businesses in the early stages of growth when revenue has yet to take off and can be erratic. Equally, it’s helpful for businesses that operate in markets that are unpredictable or seasonal, meaning revenue can be patchy.   

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Is this part of the Pay As You Grow scheme?

An iwoca Revenue-Based Loan follows the pay as you grow principle, but it’s not part of the official PAYG scheme to support business recovery from Covid-19.

Pay As You Grow options were made available to businesses once they started to repay their Bounce Back Loans, a scheme that closed to new applications on 31 March 2021. Repayments begin 12 months after the first drawn down. Options include requesting an extension on the loan from six years to 10 years, at the same fixed interest rate of 2.5%, and reducing monthly payments for six months by paying interest only.

How to apply for a pay as you grow loan

There’s no paperwork and no need to compile statements or passwords. The application process for an iwoca Revenue-Based Loan is straightforward and you can be up and running after three simple steps:

  • Just link your bank account via Open Banking, which is both convenient and secure. We’ll assess your revenue and get back to you with a decision within 24 hours.
  • Choose how much of your revenue you want to repay each month.
  • Once approved for a revenue-based loan, the funds will instantly be available through your iwoca account and you can start repaying based on future sales.  

To be eligible for a revenue-based loan, you need to have been trading for at least three months. You’ll also need to generate at least £1,000 of monthly card and online purchases.

Pay as you grow alternatives

If a revenue-based loan doesn’t suit your needs, there are several alternative funding options for your business. In particular, you could consider an iwoca Flexi-Loan, which enables you to borrow up to £500,000 for 24 months to grow your business, with no early repayment fees.

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With iwoca's reasonable rates and amazing staff, we were able to quickly obtain a loan to purchase equipment before our grand opening

Cecilia Downer

How to get a business loan with iwoca:

  1. Apply in minutes

    Just link your bank account with Open Banking – we’ll take a look at your revenue and get back to you within 24 hours.

  2. Select the amount you need

    It starts at £1,000 and go up to £50,000, and we’ll lend up to two times your monthly revenue. You can have different revenue streams at once, like e-commerce, card processors or platforms.

  3. Repay based on future sales

    You'll repay monthly: lower repayments in slow months, higher repayments in busy months. We use the information from each month's statements to calculate the monthly repayment amount based on your chosen repayment percentage (up to 25%).

The iwoca story

Over the past eleven years iwoca has grown from an ambitious fintech start-up to one of the fastest-growing and biggest business lenders in Europe. Now we're a team of around 400 in London, Leeds and Frankfurt working towards the goal of funding one million small businesses.

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Questions? We're here to help

Call us at 020 3397 3375 from Monday to Friday (9am - 6pm). We can take your business loan application over the phone, or answer your questions about applying online.

£3 billion+

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90,000+

businesses approved

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