Your online business generates £100,000 each month, but banks won’t lend because of your credit situation.
This frustrating scenario plays out daily across the UK, where successful ecommerce businesses get rejected for funding based on historical credit data that doesn’t reflect their current trading success.
Revenue-based financing changes this entirely.
Instead of judging your creditworthiness on past financial difficulties, lenders focus on what matters most – your actual sales performance and growth trajectory.
What Is Revenue-Based Financing?
Revenue based financing represents a fundamentally different approach to business funding.
Rather than offering you a loan with fixed monthly repayments, providers essentially purchase a portion of your future revenue at a discount.
Think of it as selling tomorrow’s sales today to fund growth opportunities.
How It Differs from Bank Loans
The mechanics work quite differently from conventional business loans.
Instead of borrowing a fixed amount and repaying it with interest over a set period, you receive funding in exchange for a percentage of your future sales.
This percentage continues until you’ve repaid a predetermined multiple of the original amount – usually between 1.2 to 2.0 times what you received.
What makes this particularly suitable for ecommerce businesses is the flexibility built into the repayment structure, as the payments are based on a percentage.
When your sales rise during peak periods, you’ll pay back more. During quieter months, your repayments automatically reduce.
The Market
The alternative finance market has embraced this model enthusiastically.
With over £12 billion in alternative finance arranged annually, revenue-based financing represents one of the fastest-growing segments.
Providers appreciate the reduced risk profile – they’re essentially buying a piece of proven revenue streams rather than gambling on future business success.
For online retailers, this model makes particular sense.
Your digital payment systems provide transparent revenue data, making assessment straightforward.
Whether you’re selling through Shopify, Amazon, or your own platform, providers can quickly verify your trading history and make funding decisions based on solid commercial data rather than credit scores that might not reflect your business capabilities.
Let’s talk finance!
Who Needs Ecommerce Funding Without Credit Checks?
Fast-Growing Businesses
Several types of ecommerce businesses will find it particularly valuable.
Rapid growth companies often discover their personal credit hasn’t caught up with their business success. You might be generating £500,000 annually, but if you maxed out credit cards during the startup phase, lenders still remain sceptical.
International Entrepreneurs
International entrepreneurs face unique challenges when establishing UK operations.
A successful US Amazon seller expanding into the UK market might have excellent business credentials but zero UK credit history. Revenue-based financing providers focus on your proven track record rather than local credit files, making market entry much smoother.
Seasonal Retailers
Seasonal businesses represent another ideal fit.
Fashion retailers, garden equipment suppliers, and gift companies often need substantial inventory funding before peak seasons but struggle with fixed repayments during quiet months. The flexible repayment structure aligns perfectly with their trading patterns.
Specialist Ecommerce Models
Amazon FBA sellers frequently find this funding model suits their needs.
Whether you’re expanding your product range, increasing inventory levels, or launching in new marketplaces, revenue based funding provides growth capital without the complexity of business loans.
B2B ecommerce companies dealing with extended payment terms also benefit significantly. If you’re selling to corporate clients with 30 or 60-day payment cycles, revenue-based financing bridges the gap between order fulfilment and payment receipt.
The funding amounts suit established businesses well. Most providers offer between £100,000 and £2 million, though larger deals are possible for high-revenue companies.
Related: Which Businesses Benefit Most from Revenue-Based Financing?
No Equity Dilution
One of the most compelling advantages of revenue-based financing is that you retain complete ownership of your business.
Unlike venture capital or angel investment, you don’t surrender any equity stake or give investors a say in your business decisions. Your company remains entirely yours.
How RBF Works
Applying
Getting started with revenue-based financing (RBF) feels refreshingly straightforward compared to bank loan applications.
Most providers can give you an initial assessment within 24 to 48 hours, provided you can give them access to your data, and demonstrate consistent revenue streams over the past six to twelve months.
You’ll need to share your business banking details, payment processor information, and basic trading figures. Popular platforms like Shopify, PayPal, Stripe, and Amazon integrate directly with many providers, allowing them to verify your sales data automatically.
This transparency works in your favour – there’s no need for complex financial projections or lengthy business plans.
Repaying
Instead of fixed repayment amounts, you’ll repay a set percentage of your weekly or monthly gross sales – this can be between 2% and 10% of revenue.
This percentage gets collected automatically through your payment processing systems.
When you have a brilliant week and sales spike, you’ll pay back more. During slower periods, your repayments naturally reduce, preserving your cash flow when you need it most.
The beauty of this system becomes apparent during seasonal fluctuations. A Christmas decoration retailer might see repayments surge during November and December, then drop dramatically in January and February.
This natural alignment prevents the cash flow crises that fixed loan repayments often create for seasonal businesses.
Once your total repayments equal the agreed amount, the revenue deductions stop.
Alternatives
Revenue based loans aren’t the perfect solution for every business situation.
Understanding your full range of funding options helps you make the best decision for your specific circumstances and requirements. Here’s how other financing methods compare and when they might be more suitable for your ecommerce business.
Asset-Based Options
Asset-based finance provides another route for businesses with substantial inventory or equipment. However, this approach requires valuable assets as security and often involves lengthy valuation processes.
Bridging Finance
Bridging loans offer a flexible way to obtain a short term loan. But you do need a property asset to secure the debt against.
Invoice and Trade Finance
Invoice financing works well for B2B ecommerce businesses with outstanding invoices.
You can access up to 90% of invoice values immediately, though this only helps if you’re already extending credit terms to customers. The costs can be lower than revenue-based financing, but the funding amounts depend entirely on your debtor book.
Crypto Backed Loans
We arrange crypto backed loans from £100,000 secured against your cryptocurrency holdings, letting you unlock capital while keeping your position in the market.
Credit Cards and P2P Lending
Business credit cards offer immediate access to working capital, but the amounts are limited.
They work well for smaller funding needs or short-term cash flow gaps, though the costs can escalate quickly if you’re carrying balances long-term.
Peer-to-peer lending platforms have gained traction in the UK market. These can offer competitive rates for businesses with good credit profiles, but approval times often stretch longer than revenue-based financing.
How a Specialist Broker Adds Value
Working with an experienced broker transforms your finance journey from a complex search into a streamlined process.
Brokers like Bridging Finance London maintain relationships with over 250 lenders, including specialists in alternative finance structures that many business owners will never discover independently.
The application process becomes significantly more efficient when you’re working with established industry connections. Brokers understand each provider’s preferences, criteria, and decision-making processes.
This knowledge helps position your application optimally and avoid providers who aren’t suited to your situation.
Better Terms and Ongoing Support
Negotiation represents another significant advantage.
Small businesses rarely have the power to influence terms, but well-connected brokers arranging multiple deals annually can secure better rates, more flexible repayment structures, or reduced fees.
These improvements can save thousands of pounds over the funding period.
Crypto-backed loans!
Next Steps
Revenue linked finance offers ecommerce businesses a genuine alternative when credit checks block access to growth capital.
The focus on business performance rather than historical credit scores creates opportunities for established online retailers to access flexible funding that aligns with their trading patterns.
Professional guidance ensures you secure the most suitable terms while avoiding unsuitable providers.
Contact Bridging Finance London today for a free consultation about funding options from £150,000 onwards.
To speak with a specialist broker, please call us on 020 3951 2828.
FAQ
Yes, ecommerce-based financing providers focus on your business performance rather than personal credit scores. They assess your sales data, growth trends, and revenue consistency to make funding decisions.
Most providers require monthly revenues of at least £10,000. You’ll also need 6-12 months of consistent trading history.
Initial assessments often take 24-48 hours. Complete applications with all documentation can receive approval and funding within 5-7 days, much faster than traditional business loans.
You’ll need 6 months of business bank statements, payment processor data (Shopify, PayPal, Stripe), and basic management accounts. Most providers integrate directly with popular ecommerce platforms for verification.
Our lenders offer loans between £100,000 and £2 million.
Most revenue-based financing arrangements don’t require personal guarantees or asset security. The funding is secured against your future revenue streams rather than personal or business assets.
