Finance for Pubs, Restaurants, Hotels, and Cafes
Card takings carry the summer. Fixed costs do not stop in January. The gap between those two facts is where most hospitality operators go looking for finance.
£130bn
UK hospitality sector value
180,000+
Hospitality businesses in the UK
Here is the real problem in hospitality: your rent, wages, and supplier invoices land every month, but your revenue can halve in February against what you took in August. We place a lot of merchant cash advances in this sector because the product actually fits that problem. You borrow against your card reader history and repay as a percentage of daily card sales, so a quiet Tuesday costs you a small repayment and a busy Saturday a larger one. There is no fixed monthly figure landing in the middle of a dead week. It is not the right answer for everything, though. A kitchen refit or a freehold purchase needs a different structure, and we will tell you which lender fits before we put you in front of one. As a broker we place your deal with lenders on our panel; we are not lending our own money, and what you can borrow depends on your trading and each lender's appetite.
Common Challenges in Hospitality
Seasonality against fixed costs
A seaside hotel might do 60% of its annual revenue in four months. Rates, insurance, and loan repayments do not move with the tide. Cash built up over summer gets eaten by March if there is no buffer sitting behind it.
Refurbishing without going dark
A tired dining room quietly loses covers. A full closure to refurbish loses revenue outright. Most refurbishment finance we arrange here is drawn in phases so part of the venue keeps trading while the work happens.
Equipment failing at the worst moment
A commercial oven or cold room dying the week before Christmas is not a cash flow wobble, it is a crisis. Most kitchen equipment finance gets arranged reactively, and the lenders that actually move fast in hospitality tend to be asset finance providers rather than high street banks.
Paying wages ahead of the season
Seasonal staffing means you are paying people in May to be ready for June. If the summer underperforms, you are already committed to the wage bill. Lining up working capital before the season, rather than during it, is usually the cheaper move.
Finance Solutions for Hospitality
We work with specialist lenders to find the right product for your business.
Merchant Cash Advance
An advance against your card reader history, repaid as a percentage of daily card sales, so the repayment shrinks on quiet days. No fixed monthly payment. One factor fee agreed at the start, with no compounding interest running on top.
Learn moreRevenue-Based Finance
Same idea as an MCA but repaid as a percentage of total monthly revenue rather than card takings alone. Useful for venues with a real mix of cash and card income.
Learn moreUnsecured Business Loans
A fixed monthly repayment over a set term. Better suited to a planned investment like a kitchen fit-out than to smoothing week-to-week cash flow. Lenders will want trading history and clean bank statements.
Learn moreCommercial Mortgages
If you currently lease your pub or restaurant and the freehold comes up, owning it changes the economics considerably. Hospitality freehold mortgages typically run to around 70% LTV, and the lender will want accounts plus a DSCR that covers the payments with room to spare.
Learn moreAsset Finance
Spread the cost of catering equipment, bar fittings, and refrigeration over 12 to 60 months. The asset acts as security, which usually means sharper rates than unsecured borrowing.
Learn moreWork out your numbers
Free calculators for the products hospitality businesses use most.
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Frequently Asked Questions
What is a merchant cash advance and how does it work in practice?
You receive a lump sum, and the provider takes a fixed percentage of your daily card sales until the total owed (the advance plus the factor fee) is cleared. There is no interest rate as such, just one fee agreed upfront. If you turn over £30,000 a month on card and they take 10%, that is roughly £3,000 a month going back, faster in busy months and slower in quiet ones. Most hospitality MCAs we arrange clear in around 6 to 12 months, though the term flexes with your takings. No broker can tell you the exact rate before the lender has seen your card processing statements, so be wary of anyone who quotes one blind.
Do I need to own property to borrow as a hospitality business?
No. Merchant cash advances and unsecured business loans are both available without property security. If you have been trading for at least six months and process card payments, you have options. Owning property opens up more lenders and usually better terms, but it is not a requirement for working capital finance.
Can I get finance if my business has had a rough patch or adverse credit?
Some lenders look mainly at your card turnover and recent trading rather than a credit score. A difficult stretch two years ago matters less than what your last six months of bank statements show. We will be straight with you about what is likely to fly before we put anything in front of a lender, rather than wasting a hard search on a deal that will not land.
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