RBS Small Business Loan: Features, Costs and Alternatives

What is the RBS Small Business Loan?

The RBS Small Business Loan is a fixed-rate business loan designed for small to medium businesses. The Small Business Loan is their entry-level business lending product aimed at businesses that need between £1,000 and £100,000 with predictable monthly repayments. It sits below their larger Fixed and Variable Rate Loans which start at £25,001.

Unlike revolving credit products, the RBS Small Business Loan gives you a lump sum upfront that you repay in equal monthly instalments over a fixed term. You can't draw down in stages or top up your loan later.

RBS Small Business Loan key features

• Loan amounts: £1,000 – £100,000
• Loan terms: 1 – 7 years
• Interest rate: Fixed for the full term (representative example: 8.2% on £7,500)
• Security: A personal or director's guarantee may be required
• Application time: Application takes around 10 minutes
• Funding speed: Potentially within 24 hours — sometimes even same day
• Documents required: Extensive: Address history (3 years), turnover, projected turnover, net profit, and details of existing debts

Correct as of 28-05-2026

How are RBS Small Business Loan repayments structured?

The RBS Small Business Loan uses a capital and interest repayment structure. Each monthly payment includes a portion of the loan amount (capital) plus interest. Your repayment amount is fixed throughout the term, so you'll pay the same amount every month.

RBS' other loan products (Fixed Rate Loan) offer alternative repayment structures including straight line and bullet repayments.

Will I need to provide security for an RBS Small Business Loan?

The loan is unsecured in the sense that no business assets are used as collateral, but RBS may require a personal or director's guarantee for your Small Business Loan. A personal guarantee means you're personally liable if the business can't repay.

Advantages of the RBS Small Business Loan

1. No fees

No setup fees, arrangement fees, or early repayment charges.

2. Fixed interest rate

Repayments stay the same throughout the term.

3. Quick initial quote

Get an indicative quote in about 3 minutes without affecting your credit score.

4. Potentially same-day funding

If unconditionally approved and signed before 16:30 on a weekday.

Correct as of 28-05-2026

Can I repay my RBS Small Business Loan early?

Yes. The RBS Small Business Loan has no early repayment charges. If your business no longer needs the funds, you can pay off the balance early and save on interest.

Disadvantages of the RBS Small Business Loan

1. Extensive document requirements

RBS asks for address history (3 years), turnover, projected turnover, net profit, and details of all existing debts. Not only does this create administrative burden for the borrower, it can slow down the process of making an application and getting funded.

2. Capped at £100,000

Businesses needing more would need to consider RBS' Fixed and Variable Rate Loans or an alternative lender, such as iwoca.

3. No top-ups or staged drawdowns

You can't draw down from the same loan multiple times or apply for a quick top up. If you need to borrow more, you'd need to make a new loan application.

4. No repayment holidays

The fixed monthly amount is due regardless of cash flow. There is also no ability to earn a payment holiday by overpaying the loan during high revenue periods.

5. Personal guarantee may be required

A personal guarantee from a director may be needed depending on your application. If the business fails to keep up with repayments, the director will be personally liable for repaying the loan.

Correct as of 28-05-2026

Am I eligible for an RBS Small Business Loan?

To apply, you need to:

• Be aged 18 or over
• Be a director of the business you're applying on behalf of
• Not have been declared bankrupt or received a CCJ or Court Decree

Documents required:

• Address history for the past 3 years
• Date your business started trading
• Business turnover for the last 12 months
• Projected turnover for the next 12 months
• Business net profit for the last 12 months
• Details of existing business loans or overdraft repayments
• Details of personal loans, mortgages, overdrafts, or credit card repayments

Correct as of 28-05-2026

How do I apply for an RBS Small Business Loan?

Existing RBS customers: Log in with Digital Banking details, get a quote in about 3 minutes (no credit score impact), then complete the full application online.

New to RBS: Complete the online application form. RBS will get in touch to discuss next steps.

Will RBS perform a credit check for a Small Business Loan?

RBS will run a soft credit check to give you an indicative quote; this won't affect your credit score. However, if you proceed to a full application, RBS will carry out a credit check that may impact your score.

With iwoca, it works similarly: applying only triggers a soft check. A full credit check only happens if you accept a loan offer.

What documents are needed for an RBS Small Business Loan?

RBS asks for quite a bit of information upfront: your address history for the past 3 years, the date your business started trading, business turnover and net profit for the last 12 months, projected turnover for the next 12 months, and details of any existing loans or credit repayments (both business and personal). RBS may also request additional supporting evidence.

How long does it take to get an RBS Small Business Loan?

RBS states that funds can arrive within 24 hours of approval. If you're unconditionally accepted and sign your loan documents before 16:30 on a weekday, same-day funding is possible. However, the extensive document requirements can often lengthen the time it takes to complete an application and get a decision.

Other RBS lending products

The Small Business Loan is just one option in the RBS lending range. Depending on your needs, these other products may be relevant:

• Fixed and Variable Rate Loans (from £25,001 to £10M): For larger projects. Terms up to 25 years, with capital repayment holiday options. More complex, time-consuming application process.
• Business Overdraft (£500 – £50,000): Revolving credit where you only pay interest on what you use. No fixed repayment term — useful as a short-term safety net.

Correct as of 28-05-2026

Do I need an RBS bank account to get a Small Business Loan?

No. RBS accepts applications from businesses that hold their current account with any provider. Although if you don't have an RBS account, you may be required to set up a fee-free Loan Servicing Account to facilitate the loan — this isn't a full business current account and has no transaction charges.

Alternatives to the RBS Small Business Loan

iwoca Flexi Loan

If the RBS Small Business Loan doesn't quite fit — maybe you need more than £100K, or you'd rather not dig out financial projections — the iwoca Flexi Loan is worth a look. It's built for businesses that want speed and flexibility without the paperwork of a traditional bank loan.

Here's what makes it different:

• Borrow up to £1 million — ten times the RBS Small Business Loan cap, suitable for SMEs of all sizes.
• Multiple drawdowns — borrow as much or as little as you like, up to your credit limit, across multiple drawdowns. Only pay for what you use.
• Top-ups available — need more later? Once you've repaid 15–33% of your loan, you can apply to top up your loan.
• Minimal paperwork — many applicants don't need to share any documents at all. When we do ask for documents, we only ask for bank statements and sometimes company accounts and VAT returns. With iwoca, you never need to spend time producing lengthy business plans or complex financial projections just to get a loan.
• No early repayment fees — pay off your loan whenever you like, and never face any penalties for doing so. You'll only be charged interest for the days you had the money.
• Soft credit check at application — checking your eligibility won't affect your credit score
• A dedicated account manager — someone who knows and cares about your business, not just a chatbot.
• Fee-free overpayments — pay down extra during higher revenue periods, and watch your interest costs drop.

Interest rates start from 1.5% per month, with no fee on 12-month loans. Longer-term loans (over 12 months) may incur a 5% - 6% setup fee.

Apply for an iwoca loan today →

RBS Small Business Loan vs iwoca Flexi Loan

The RBS Small Business Loan is a straightforward option if you want a fixed-rate loan under £100,000 and don't mind the lengthy documentation requirements. But if you need higher amounts, the ability to top up, or a simpler application with more streamlined document requirements, the iwoca Flexi Loan may be a better option for you.