Business loan vs asset refinance for raising cash

2 min read

On affordabilityUnsecured loan

On owned assetsAsset refinance

Amount vs safetyThe trade

Two ways to raise cash

If you need to raise a lump of cash, two common routes are an unsecured business loan — borrowed against the company's affordability, with nothing charged — and asset refinance, which unlocks equity in equipment or vehicles you already own by advancing against their value. The loan keeps your assets clear; the refinance can raise more against valuable kit but puts a charge over it. See asset refinance vs new borrowing.

Amount, cost and risk

	Unsecured loan	Asset refinance
Based on	Company affordability	Owned assets' value
Amount	Affordability-led	Up to the asset value
Risk	No asset charged	The asset is at stake
Speed	Fast	Valuation needed

If you own valuable, unencumbered kit and need a larger sum than affordability alone supports, refinance can unlock it — at the cost of charging the asset. If you want speed and to keep assets clear, an unsecured loan fits, sized to what the company can service.

Which to choose

For a modest sum, or where you rely on the equipment and would rather not risk it, an unsecured loan is simpler and safer. For a larger raise where you own significant kit and accept the charge, refinance can go further. Weigh the extra amount against the risk to the asset — see when to pledge an asset.

The Credicorp view

To raise cash while keeping your equipment clear and your decision fast, a Credicorp business loan borrows on the company's affordability with no charge over your assets and no personal guarantee. For unlocking large equity in owned kit, a specialist asset refinancer may go further. Register to apply. Educational content, not financial advice.

Frequently asked questions

Should I take a loan or refinance an asset to raise cash?

For a modest sum, or where you rely on the equipment and would rather not risk it, an unsecured loan is simpler and safer. For a larger raise where you own significant kit and accept a charge over it, asset refinance can go further. Weigh the extra amount against the risk to the asset.

Which raises more cash?

Asset refinance can raise more against valuable, unencumbered kit, because it advances against the asset's value rather than being capped by affordability alone. An unsecured loan is sized to what the company can service. The refinance's larger sum comes at the cost of charging the asset.

Which is faster?

An unsecured loan is usually faster, because it assesses the company's affordability without a valuation. Asset refinance needs the kit valued, which adds time. If speed matters and the sum is within affordability, the unsecured loan is typically the quicker route to cash.