Frequently Asked Questions

Do you have a question or a general query about our loans?

If you have a question that isn’t answered below, please contact us.

Do you have a question or a general query about our loans?

The Loan

BLS provides loan finance to new and existing, small and medium sized businesses across Scotland. BLS charges a fixed rate of interest and offers repayment periods of up to 5 years.

Loans are managed by Business Loans Scotland on behalf of the Scottish Growth Scheme - Business Loans Scotland Debt Finance Fund LP (SL033447) and are fully funded by the Scottish Government.

Business Loans Scotland offers loans from £25,000 up to a maximum of £250,000 to new and growing, small and medium sized businesses. BLS normally provides up to 50% of the total funding required up to a maximum of £250,000. BLS would expect the other 50% to be sourced from the private sector, for example bank funding, directors / owners input, equity investment, HP etc

However, in exceptional circumstances, the funding available can extend to more than 50% of the amount required. Where the Fund is providing more than 50% of the funding, there may be a higher degree of risk associated with the project and therefore additional information and/or security may be required.

The current interest rate is set at a fixed rate of 11% for the term of the loan.

If you are a new business (trading less than 12 months at the time of application) with a high risk profile and / or low level of security available, a higher rate of interest may be applicable.

BLS is a Government-backed Fund, so all interest is re-invested, meaning even more individuals and businesses can benefit from this affordable finance and support. At a fixed rate of 11% per annum, the interest is designed to be affordable compared to other mainstream lenders. The flexible loan term of one to five years gives our customers the ability to manage their monthly repayments in a way that makes most sense for them. Check out our Loan Calculator to figure out your potential monthly cost and total loan repayments.

No. There are no fees involved in either applying for or receiving a BLS Loan and no fees for the support provided by your Local Authority or Business Gateway adviser during and after the application process.

Before starting an application on our Online Loan Application (OLA) system, you should have the following information available for uploading as part of your application for funding: 

  • Current Business Plan
  • 2 years Historical Financials (where appropriate)
  • 2 years Financial Projections including Profit & Loss & Balance Sheet and detailed assumptions supporting these figures
  • 2 years monthly Cash Flow Forecast
  • Copy of a Current Bank Statement
  • Organisational Chart (where appropriate)
  • Copy of Heads of Terms for a current Lease or Proof of Building Ownership
  • Details of all the key people involved with the business and any shareholder owning >25% or more of the share capital
  • As part of the process BLS will also require documental evidence of the contribution to the funding package from the other sources of finance (where appropriate).

A secured loan is one that requires a guarantor or an asset, for example a property (also known as collateral) to secure the loan. In the event that a secured loan cannot be repaid, the company issuing the loan may take possession of the property or call on the guarantor to satisfy the outstanding balance.

In contrast, unsecured loans can be obtained without the use of a guarantor or collateral for the loan. However, please remember you are still contractually obligated to repay your BLS Loan, no matter what the circumstances.

Failure to meet your monthly loan repayments may result in formal action being taken, and could detrimentally affect your credit, so it’s important to talk to us as soon as possible if you think you may encounter any difficulties.

Funds from BLS are flexible and can be used to finance; 

  • Funding to get your business started
  • Working capital
  • Purchase of new or used plant, machinery or equipment
  • Purchase / expansion / renovation of business property
  • Funding innovation and expansion projects
  • Expanding into new markets

Yes. A Business Loans Scotland loan is a business loan made into the borrower’s business bank account and loan repayments must come from the business bank account.

No, there can be more than one as long as all criteria are met.


The Fund can support the following types of legally formed and trading SME:

  • Sole Traders (loans over £25,000 only)
  • Partnerships (loans over £25,000 only for partnerships with 3 or fewer partners)
  • Partnerships with 4 or more partners
  • Limited Companies
  • Limited Liability Partnerships

BLS will support businesses operating in a wide range of sectors which can be summarised as follows; 

  • Manufacturing
  • Service to manufacturing
  • Accommodation and food service activities
  • Construction
  • Transport and storage
  • Information and communication technologies
  • Scientific and technical activities
  • Administrative and support activities
  • Agriculture linked to farm diversification
  • Tourism and Tourism infrastructure
  • Some Service based activities

Each business will be required to demonstrate the level of additionality their business or project will achieve at the local, regional or national economy level.

The following sectors may not be eligible for support: 

  • Sale of Motor Vehicles
  • Real Estate and Speculative Property Development
  • Professional Services
  • Social and Personal Services
  • Local Services

Certain business activities which may not strictly adhere to the above sectors may be considered, including: 

  • Restaurants which support the local tourism product
  • Retail activities in isolated settlements where there is no suitable alternative provider within the area or with a specific tourism focus
  • Specialist B2C activities where key skills could be lost (e.g. specialist florists) 

This list is not meant to be exhaustive and if you have an “interesting” project that will bring economic impact at the local, regional or national level, we’d like to hear from you.

This check is to make sure your business is eligible and ready to apply. This check ensures you and your business have all the relevant documentation and information to apply to avoid any delays in the application process.

Poor credit isn’t necessarily a barrier to securing a BLS Loan, however we do carry out a full credit check on the business. BLS is committed to lending responsibly and has to ensure that applicants will be able to repay the loan.

The Application Process

  • Visit the website – – check you are eligible and ready to apply for a loan
  • If your business is eligible you can submit an enquiry and one of our Loan Officers will be in touch to discuss your requirement
  • If you are eligible and are ready to apply you will be asked to complete an online application and provide supporting documentation
  • A Local Authority / Business Gateway Adviser is available to assist you prepare your application and supporting documentation.
  • The application will be appraised by BLS
  • BLS will make a decision to approve or otherwise and you will be notified accordingly
  • If approved, the business will require to complete a loan agreement agreeing to the terms and conditions along with any security documentation
  • The loan will be released upon completion of all appropriate documents into your business bank account.

BLS will consider a range of factors when assessing an application including the following: 

Business viability: A key factor in our lending decision is ensuring that your business is going to generate enough money to meet the monthly loan repayments. To help BLS assess this, you need to demonstrate that there is sufficient demand for your product(s) and/or service(s) and that you will be able to reasonably achieve all of the goals set out in your Business Plan and Cash Flow Forecast.

Your Local Authority or Business Gateway Adviser will be able to provide support throughout this part of the pre-application process. 

Structure of the funding package: BLS prefers to be a gap funder and will expect to see some funding being introduced from other sources such as banks, directors, investors etc. The other funders must be committed to the proposal before BLS will release a loan to ensure that the Business receives fully, what it needs to go forward.

Credit worthiness: As part of the application, BLS will obtain a credit report on the business. While poor credit history will not prevent you from securing a BLS loan, this part of the application process is part of our commitment to responsible lending and helps us ensure our applicants don't overburden themselves.


A dedicated appraiser at Business Loans Scotland will assess your loan application and will make a recommendation. BLS will make the decision on your loan based on this recommendation supported by the information provided. The team at Business Loans Scotland will work together with your local authority to make the decision on your loan based on the proposal supported by the information provided including your business plan.

There are a number of reasons why your application can be declined assuming you have met BLS criteria and the BLS team will advise you of this as soon as possible.

As a responsible lender, the main criteria we use to determine whether or not we can lend to a business relates to the viability of the business and its ability to repay the loan (will you be able to reasonably achieve all of the goals you have set out in your plans?).

From receipt of a completed application, along with all the supporting documentation, BLS would expect to have a decision to you within 2 weeks. Thereafter, the loan agreement and any security documentation will require to be completed to allow the loan to be released. Some applications may be processed much quicker than others, however some with complex proposals or security requirements may take longer. On average the time expected for a loan application to reach drawdown is around 13 weeks. Whilst this may seem a lengthy period of time this includes time to submit the application and all the supporting documentation. Some applications may be processed much quicker however some with complex proposals or security requirements may take longer.

Under the terms of a BLS loan you will be asked to provide your annual accounts timeously, so BLS can monitor the impact of the loan on your business in terms of turnover and profitability. You will also be asked to provide the number of employees (FTE), employed in your business at that financial year end.

Once you have your loan, you can continue to receive on-going business support from your Local Authority / Business Gateway Adviser.

Credit Checks

Business Checks: BLS will obtain a business credit check as part of the assessment of your application. This credit report will provide details of the business’ financial position and its payment record.

Please note, after a credit check has been conducted, BLS is not able to discuss the specific details of your credit report with you. If you have concerns regarding the business credit history, you will need to contact a Credit Reference Agency to request a copy of a Credit Report and address any concerns with them directly. BLS currently use Experian Credit Referencing, however this may change from time to time.

When a credit check is completed as part of your BLS Loan application, it leaves a ‘footprint’ on your credit report showing that BLS has accessed the credit history. This may impact upon the credit score; however a credit score is made up of many different factors that offer a combined view of financial behaviours (such as other applications for credit, any credit previously secured and the history of making credit repayments etc.).

Poor credit isn’t necessarily a barrier to getting a BLS Loan, however we do carry out full credit checks on the business and the key people such as directors/shareholders. BLS is committed to lending responsibly and has to ensure that applicants will be able to repay the loan.

Loan Repayments

The loan can be repaid over 12-60 months. The exact term will be agreed during the assessment and will relate to your cash flow to ensure the payments are affordable and realistic.

You should contact BLS immediately and let them know your situation. It is always best that you speak to us if you believe you may not be able to make your next repayment, rather than wait until the payment is missed.

BLS follows standard market practice when loan repayments are missed and take a fair and reasonable approach. If you fail to make a payment, BLS will contact you to determine the reasons for the payment being missed. They will also work with you to come to a reasonable and fair agreement about how to address this and fulfil your obligations in the future.

If BLS is unable to contact you after repeated attempts, we may then look to recover the outstanding payments through various means such as, but not limited to, calling on any security held and/or taking appropriate legal action, applying to issue a County Court Judgment (CCJ) or referring your case to a Debt Collection Agent.

Yes. If a business has problems with repaying the loan they can seek support from their Local Authority / Business Gateway Adviser that helped them apply for the loan. Business Loans Scotland is committed to helping businesses through difficult times and aims to provide options to help businesses succeed.

About Business Loans Scotland

Business Loans Scotland is a consortium of Scotland’s 32 Local Authorities, incorporated as a company limited by guarantee in March 2015, to provide loan finance up to £250,000 to new and growing, small and medium-sized businesses (SMEs) across Scotland.

A Business Loans Scotland loan is a loan to help you start or grow your business. The loan is given for business purposes. Your loan application will be considered according to the needs of your business and the economic impact locally or nationally.

No. Funding from BLS is by means of loan capital and must be repaid.

Business Loans Scotland is the Fund Manager for a £17 million fund, which seeks to invest in new and growing Scottish SMEs.

The loan is provided by the Scottish Growth Scheme - Business Loans Scotland Debt Finance LP (SL33447) and is fully funded by the Scottish Government.

BLS provides loans to business based all over Scotland.

Our Registered Office is:

London Road Centre
London Road


BLS has a range of policies to ensure it operates within the law and all associated regulations. These include, but are not limited to, the following, please click on the link to access the policy:

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