Royal Bank of Scotland business loans review

Read our guide on Royal Bank of Scotland’s business loans to see if they could be the right choice for funding your business

30 June 2020

What is the Royal Bank of Scotland?

RBS is a large, high street bank with over 700 branches across Scotland, England and Wales. Founded in 1727, RBS now offers trade, invoice and asset finance as well as a number of different types of business loans.

They’re also accredited for both the Coronavirus Business Interruption Loan Scheme (CBILS) and the Bounce Back Loan Scheme (BBLS) but are currently only accepting applications from existing customers.

Coronavirus information

If your business needs funding because of coronavirus and you don’t currently have an account with RBS, see if you can apply for a CBILS loan with us. You could borrow between £50,001 and £350,000 with nothing to pay for the first 12 months: it could help get your business back on its feet.

Read on to find out more about Royal Bank of Scotland business loans.

RBS business loans – an overview

There are a number of different types of business loans to choose from when applying for funding from RBS. Check out our summary table to get a better idea of what each of them looks like.

Key featuresSmall business loanFixed rate loanVariable rate loan
Loan amount£1,000 – £50,000£25,001 – £10m£25,000+
Loan term1 – 7 years, 10 years on requestUp to 25 years3 months to 25 years
Early repayment feeNoNoNo
Arrangement feeNoMay applyMay apply
Fixed or variable ratesFixedFixedVariable
Secured or unsecuredSecurity may be requiredSecurity may be requiredSecurity may be required

Trustpilot score

RBS has a Trustpilot score of 1.4, ‘bad’ from 419 reviews.

Frequently asked questions

Still got questions about RBS business loans? We’ve got answers.

Am I eligible for an RBS loan?

RBS do usually accept applications from new customers, but due to the increased demand for finance as a result of coronavirus, you’ll need to be an existing customer to apply.

You'll also need:

  • to be a UK resident
  • to be over 18 years old
  • your business to be registered in the UK, Channel Islands, Isle of Man or Gibraltar
  • to use the loan for business purposes
  • to hold a good credit rating

How do I apply for an RBS business loan?

You can apply for each of the RBS loans online. Make sure you’re on their ‘business’ section, then navigate to their loans and finance tab via the products and services. Here, you’ll find each loan description and the relevant application forms.

What documents are needed for an RBS business loan?

To apply for a business loan through RBS, it’s likely you’ll need to provide information about the financial position of your business. The amount of information you’ll need will depend on whether you already bank with RBS or not.

You could be asked to provide the following depending on which RBS business loan you apply for:

  • details on the purpose of your loan
  • information about your business
  • annual accounts of tax returns for the last two years
  • proof of assets and debts
  • a business plan
  • an up to date cash flow forecast
  • Information regarding other business interests

Getting these documents ready before you apply is likely to increase the speed of your application and get you the funds faster. Read more about which information each business loan requires using this checklist.

Will RBS perform a credit check?

It’s normal for a lender to perform a credit check on businesses applying for finance to gauge their health and history. RBS will carry out one of these checks if you apply for a loan.

You’ll be able to maintain a healthy credit score by:

  • paying your bills on time
  • registering for the electoral roll
  • paying off any debts you may have, and paying more than the minimum allowed
  • close old or unused credit cards accounts, direct debits and phone contracts

How long does it take to be approved?

The RBS website doesn’t provide any timelines, so it’s best to enquire directly if possible. Bear in mind that RBS have seen an increase in demand for business finance due to the coronavirus pandemic, so approval times for loans may be longer than usual.

Will I need to provide security?

You may need to provide security for your RBS business loan, but whether you do will depend on the specifics of your agreement. All product specifications state that security ‘may be required’ so it’s best to clarify this with RBS themselves during your application.

Can I repay my loan early?

The Fixed Rate, Variable Rate and Small Business Loan all allow you to make early repayments with no charge. This means you can save on interest if you decide your business no longer needs the money.

How are repayments structured?

RBS has three types of loan repayment profiles that dictate how you’ll pay back your loan. These repayment profiles are called Capital & Interest, Straight Line and Bullet. Some of their loan products only give you one option, but it’s worth knowing what they all mean as it may influence your final decision.

Capital & Interest : You repay your loan principal and interest periodically. It’s likely you’re already familiar with this repayment structure as it’s how loans are typically paid back.

Straight Line: You’ll periodically repay your loan principal, while interest is applied separately to an RBS current account.

Bullet: You repay the principal of the loan in one instalment at the end of the loan, with quarterly interest applied to an RBS current account.

RBS’ Small Business Loan and Variable Rate Loan only allow you to repay using the Capital & Interest profile, while the Fixed Rate Loan offers all three options.

What are the advantages of an RBS business loan?

  • There are three different repayment profiles to choose from, meaning you can pick the right one for your business
  • You can fix your interest rate for between 10 and 15 years with the Small Business Loan and Fixed Rate Loan products
  • RBS state that their decision making process is transparent, and offer a dedicated relationship team

What are the disadvantages of an RBS business loan?

  • RBS are only serving existing customers at the moment due to the increased demand for business finance during the coronavirus crisis
  • RBS has a low Trustpilot rating at just 1.4 out of 5
  • You’ll pay arrangement and security fees for some of RBS’ loan products, depending on how much you borrow.

iwoca is accredited for CBILS

If you’re looking for finance because your business has been negatively affected by coronavirus, then consider taking a CBILS loan with us.

You can borrow between £50,001 and £350,000 for up to five years with an iwoca CBILS loan, without paying a penny for the first 12 months. Use our CBILS calculator to work out if this is a good option for your business and get an idea of what your repayment schedule could look like.

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Dan is part of the content team at iwoca. He writes articles explaining financial topics, as well as guides on the best support for small businesses during coronavirus.

Article updated on: 6 July 2020

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