As a business owner, accessing business funding can feel complex, particularly with so much conflicting information in the market. Before you rule out your options, here are three common funding myths that often hold growing businesses back — and the reality behind them.
Myth 1: “You need perfect credit to get business funding”
Reality:
While credit matters, it’s rarely the only factor. Many lenders focus more on cashflow, assets, contracts, or project viability than historic credit issues. Asset finance, invoice finance and development funding can remain accessible even with imperfect credit profiles.
What really matters: Ability to service the funding and manage risk.
Myth 2: “Bank loans are always the cheapest option”
Reality:
Banks may offer lower headline rates, but they often come with long approval times, rigid criteria and inflexible terms. Alternative and specialist lenders can provide faster access, tailored structures and higher certainty, often delivering better overall value despite higher rates.
What really matters: Total cost, speed, and certainty—not just interest rate.
Myth 3: “You must be trading for years before you can get funding”
Reality:
While trading history helps, many lenders will fund start-ups, new SPVs, or newly formed businesses if there is a strong management team, clear projections and appropriate security. Project-led and asset-backed funding frequently prioritise the deal over the length of trading history.
What really matters: Strength of the proposal, not just business age.
Myth 4: “If you’ve been declined once, you won’t get funding anywhere”
Reality:
A decline from one lender does not equal a decline from all. Different lenders assess risk differently, and many specialise in specific sectors, deal sizes, or funding purposes. A well-structured proposal can succeed even after multiple initial rejections.
What really matters: Matching the business to the right lender and structure.
Myth 5: “Business funding will hurt cashflow”
Reality:
Poorly structured funding can strain cashflow—but the right facility should support and stabilise it. Options like interest-only periods, staged drawdowns, or revenue-aligned repayments are designed to reduce pressure, not increase it.
What really matters: Structure and repayment alignment, not just borrowing.
Get in touch to see how we can help your business with funding solutions – paula@metisfunding.co.uk