Spotcap business loans review

If you’re considering Spotcap’s business loan as a solution to your funding needs, make sure you know the facts. Here, we’ve gathered all you need to know to make an informed decision.

11 March 2020

Spotcap is a fintech start-up offering quick and easy access to small business loans. The lender says it uses a unique programme to calculate a small business owner’s credit profile. Founded in 2014 by VC firm Rocket Internet, it has since raised over £90m in global investment. Headquartered in Berlin, the startup has operations in the UK, Spain, the Netherlands, Australia and New Zealand.

Spotcap business loans at a glance

Loan amount£50,000 to £350,000, or approximately 8-12% of your annual turnover
Loan durationUp to 24 months
Setup feeApplication is free but a 3% arrangement fee is added upon your first withdrawal
Interest rateInterest is charged on a monthly basis and is based on how creditworthy your company is, the size of your Spotcap business loan and the duration of the loan.The average monthly interest rate is 1.4% and the average nominal yearly interest is 16.8%.
Fixed or variableFixed
Secured or unsecuredEither - you can get a loan with no personal guarantee, with a full or partial guarantee and with a corporate guarantee.
Trustpilot score5 out of 5, “excellent” from 130 reviews

Every care has been taken to ensure this information is accurate. All information was correct as of 5th March 2020

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Frequently asked questions

Am I eligible for a Spotcap business loan?

To be eligible for a Spotcap business loan your business must be registered in the UK and have a UK business bank account. On top of this, the business must have been operating for at least three years with an annual turnover of £500,000 or more.

Other things that will help your application are that your business is growing and profitable, and has a well-managed bank account with minimal short-term debt on the most recent balance sheet.

How do I apply for a business loan from Spotcap and what documents are needed?

The Spotcap application process is all done online. You have to fill out basic information about your business and provide some financial statements and documents.

If you are applying for a loan of between £50,000 and £200,000, Spotcap asks for six months of bank statements in CSV or PDF format; your latest filed and completed annual accounts, or management accounts if the annual accounts are over six months old; four quarters of VAT returns; and an aged debtor listing where invoice finance is being used.

For a loan of between £200,000 and £350,000, you must provide 12 months of bank statements in CSV or PDF format; your latest filed and completed annual accounts, or management accounts if the annual accounts are older than six months; five quarters of VAT returns; and an aged debtor listing where invoice finance is being used.

If your business is part of a group, you’ll be asked to submit consolidated accounts and an organisational chart showing the percentage of ownership.

Will Spotcap perform a credit check?

Spotcap takes both business and personal credit scores into account when considering your application, but also looks at factors like how well your business is performing and your cash flow. They will run a hard search on businesses during the initial application process then, if your application has the potential to be approved, a hard credit check is performed on one of the business’ Directors.

How long does it take to be approved?

One of the main benefits of Spotcap commercial lending is their fast service. Once your application is complete, a decision will be made within one working day as to whether or not you meet the lending criteria.

Will I need to provide security?

It depends on the type of loan you are after. Spotcap offers small business loans with full or partial personal guarantee and corporate guarantee, as well as unsecured small business loans that come with no personal guarantee.

Can I pay off a Spotcap loan early?

Yes, Spotcap business loans can be paid off early and there are no extra charges or fees for making an early repayment.

Can I make overpayments on a Spotcap loan?

Yes, you can and there are no charges for overpayments. However, overpayments will not affect the loan duration or structure – if you have more capital to repay one month and you pay back double the scheduled amount, you’ll simply skip the following month’s direct debit, returning to the loan schedule after a month’s break.

What are the advantages of a Spotcap business loan?

Quick response Spotcap processes loan applications within one working day, so you won’t be waiting around for long. Also, if you need to get in contact with the team they are quick to get back on any questions.

Not just based on your credit score Spotcap evaluates your business performance as well as checking your credit score to build up a more comprehensive picture of your risk profile.

No charges until you withdraw Even after Spotcap approves you for a credit line, you will not be charged anything until you make your first withdrawal. If you decide not to withdraw at all, you won’t pay any fees or interest.

Pay only on what you withdraw Your Spotcap business loan will be agreed as a certain amount. Once your credit line is approved, you will have one month to withdraw as much of that as you want, as often as you like. When it comes to repaying, you’ll pay back only what you actually withdrew and not the total agreed sum of the line of credit.

What are the disadvantages of a Spotcap business loan?

Arrangement fee An arrangement fee of 3% of the total credit limit is charged the first time you drawdown, even if you don’t end up using the full loan amount.

High minimum loan Given that the minimum you can borrow is £50,000 and your business must be turning over at least £500,000 a year to qualify for a credit line, Spotcap business loans are not suitable for very small businesses.

Not for new start ups Your business has to be at least three years old to qualify for a Spotcap business loan, so if your business is relatively new, even if it’s performing very well, Spotcap isn’t for you.

Further considerations

Before deciding on whether to get a Spotcap small business loan, it’s worth considering the other options available to SMEs first, such as asset finance, peer to peer lending, a business overdraft or an iwoca business loan.

iwoca is a responsible lender with an excellent Trustpilot rating that can help small business owners access loans of as little as £1,000.

Why use iwoca?

With iwoca's Flexi-Loan you can borrow £1,000 to £200,000 for up to 12 months. It’s quick and simple to apply online – our application process takes just five minutes to complete and won't affect your credit score. You could have the funds in your account within 24 hours. Repay early and you can even save interest.

We use award-winning technology to make fair decisions based on your business performance overall, not just your credit score. Without any rigid criteria or endless paperwork. Our customers small business loans to bridge late invoices, invest in stock and cover unexpected expenses.

To learn more, visit our small business loans page.

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Persis Love is a freelance writer and producer. She has made podcasts for the Financial Times and written for Latin News and Al Arabiya.

Article updated on: 19 March 2020

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