Secured loan vs invoice finance

2 min read

Asset pledgedSecured loan

Ledger-linkedInvoice finance

What's the securityThe difference

Different security, different behaviour

Both are secured, but on different things. A secured loan pledges a specific asset — property or equipment — for a lump sum at a lower rate, repaid on a fixed schedule. Invoice finance is secured on your unpaid invoices, releasing cash as you bill and scaling with sales. The secured loan gives a fixed sum against a fixed asset; invoice finance gives a growing facility against a moving ledger. See secured vs unsecured and the invoice finance guide.

Which fits your position

	Secured loan	Invoice finance
Security	A specific asset	Your invoices
Amount	Fixed lump sum	Grows with sales
Best for	You own a chargeable asset; want a defined sum	Cash locked in a growing B2B ledger
Risk	The asset at stake	Ledger tied in

If you own a valuable asset and want a defined sum at a low rate, a secured loan fits. If your cash is tied up in a growing book of invoices, invoice finance targets that and grows with you. If you would rather pledge neither, an unsecured loan is the alternative.

The Credicorp view

If you would rather not pledge an asset or tie in your ledger, an unsecured Credicorp business loan borrows on the company's affordability with no charge over your property or invoices, and no personal guarantee. For a large raise against an owned asset or a growing ledger, a secured loan or invoice finance may go further. Register to apply. Educational content, not financial advice.

Frequently asked questions

Secured loan or invoice finance — which is better?

A secured loan suits owning a valuable asset and wanting a defined sum at a low rate, pledging that asset. Invoice finance suits cash locked in a growing book of B2B invoices, funding against your ledger and scaling with sales. The right choice depends on what security you have and whether you want a fixed sum or a growing facility.

What's the difference in security?

A secured loan is backed by a specific asset such as property or equipment, which is at stake if you cannot repay. Invoice finance is secured on your unpaid invoices, tying your ledger into the arrangement rather than a physical asset. They behave differently — a fixed sum versus a facility that grows with sales.

Can I avoid pledging anything?

Yes, with an unsecured loan, which borrows on the company's affordability with no charge over your assets or invoices. It costs more than a secured route because there is no security, but it keeps both your assets and your ledger clear, which many directors prefer for a modest need.