Non-bank finance

Take care to avoid unauthorised lenders - otherwise known as loan sharks. An unauthorised lender may give you quick access to credit, possibly without needing a business plan or security, but there may be drawbacks including unfavourable interest rates and loan terms.

To find out if a lender is licensed by the Financial Conduct Authority (FCA) you can search the Financial Services Register.

You may be dealing with a loan shark if:

• the salesperson is pestering you or is particularly pushy
• the interest rate is significantly higher than other lenders
• the company is reluctant to show you the loan terms and conditions
• you are asked to tie yourself into a longer-term contract than you need

You may also find yourself a target for loan sharks if you have a poor credit record and would normally find it difficult to raise finance. Read GOV.UK guidance on loan sharks.

For information on how you may be able to secure non-bank finance, see eight types of non-bank financial support.