Do I need a business bank account for funding?
In practice, yes. UK business lenders generally require a UK business bank account in the name of the borrowing company, because that is where the funds are paid, where repayments are collected from, and where the lender looks to see how the business actually trades. A personal account used for business takings is commonly a reason an application stalls before it has started.
Increasingly the account is also the application. Many lenders ask the business to connect its bank account through Open Banking so they can read transactions directly rather than waiting for PDF statements. YouLend, for example, asks applicants for an Open Banking connection as part of its process. Below is what the main lenders publish, checked in August 2026.
Why do lenders ask for a business bank account?
The money has to go somewhere and come back from somewhere, and a lender wants both legs in the name of the entity it has a contract with. Bank statements are also the clearest picture of a business that exists: they show real income, real outgoings, bounced payments and existing borrowing without anyone's opinion attached. And anti-money-laundering checks are simpler where the account name matches the company name on Companies House.
A personal account blurs all three, which is why most funders aimed at limited companies will not proceed without a dedicated business account.
What do the main UK lenders publish about eligibility?
Each lender sets its own criteria. The positions below are taken from the lenders' own pages or from recent reviews and were checked in August 2026. Where a lender's requirement is reported second-hand rather than stated on its own site, that is noted.
| Lender | Business structure | Trading and other requirements |
|---|---|---|
| iwoca | Operate as a limited company or a partnership | Personal guarantee from a company director; no charge for repaying early |
| Funding Circle | UK-based business | Trading for one year or more; a personal guarantee will be required |
| YouLend | Card-taking businesses (per review) | Three months trading, £1,500 a month minimum card sales, Open Banking connection |
| 365 Finance | Card-taking businesses | Six months trading and £10,000 a month average card sales; soft search only |
What is an Open Banking connection and why do lenders want it?
Open Banking is the UK framework that lets a business give a regulated third party read-only access to its bank transactions. For a lender it replaces the exchange of statements with a live, verifiable feed. The business logs in to its own bank during the application and grants access; nothing about the account changes and the lender cannot move money.
YouLend asks for an Open Banking connection as a standard part of its application, and one review notes that a steady sales record counts for more with YouLend than a spotless credit file, which is only possible because the lender is reading the transactions directly. Other lenders offer Open Banking as an option alongside uploaded statements. A business that prefers not to connect commonly finds it can still apply, but with more paperwork and a slower process.
Does the business structure matter as well as the account?
Yes, and for finance introductions it matters a great deal. CapExpand introduces limited companies and LLPs only. Lending to sole traders and small partnerships can fall within the scope of consumer credit regulation, and CapExpand is not currently FCA-authorised, so it does not introduce those businesses for finance. A limited company borrowing for its own trade generally sits outside that regime.
Lenders draw their own lines too. iwoca states it lends to businesses that operate as a limited company or a partnership. Each lender publishes its own eligibility page, and the entity types it accepts are best confirmed there directly.
What about new companies and businesses with a new account?
A business account that was opened last week tells a lender very little, which is why trading-time minimums exist alongside the account requirement. YouLend's three months and 365 Finance's six months are among the shortest published; Funding Circle asks for a year. A company that has incorporated recently but has been trading as a sole trader for longer commonly finds lenders will look at the older history where it can be evidenced, though that is lender by lender.
Where a business has been taking payments through a personal account, the usual sequence is to open the business account, route takings through it, and apply once there are a few months of history to show. This page is general information, not advice.
Frequently asked questions
Can I apply for business funding using my personal bank account?
Lenders generally require a business account in the name of the borrowing company. A personal account may be accepted by a small number of providers for sole traders, but for a limited company the account name is expected to match the company, and most funders will not pay out to a personal account.
Do I have to connect Open Banking to apply?
Some lenders make it standard; YouLend asks for an Open Banking connection as part of its application. Others accept uploaded statements instead. The connection is read-only, the lender cannot move money, and access can be revoked through the bank.
How long does a business account need to have been open?
Lenders generally care about trading time rather than account age, but they can only see trading through the account. Published minimums include three months at YouLend, six months at 365 Finance and one year at Funding Circle, checked in August 2026. Criteria vary by lender and product.
Does CapExpand introduce sole traders for finance?
No. CapExpand introduces limited companies and LLPs only for finance, because lending to sole traders and small partnerships can fall within consumer credit regulation and CapExpand is not currently FCA-authorised. Card machines are a separate product: card-terminal hire itself is not an FCA-regulated activity, although the acquiring behind it is and are available to sole traders.
Limited company with a business account and trading history?
CapExpand introduces UK limited companies and LLPs to lenders and funders. Tell us how long the company has traded and what the account shows, and we connect you with providers whose published criteria match.
Sources
Lender criteria checked August 2026. They change without notice; confirm with the lender before applying.
- iwoca support: how iwoca loans work and who is eligible (limited company or partnership, personal guarantee, early repayment)
- Funding Circle: small business loans (UK-based, trading one year or more, personal guarantee required)
- Business Expert: YouLend review (three months trading, £1,500 monthly card sales, Open Banking connection)
- 365 Finance FAQs (six months trading, £10,000 monthly card sales, soft search)
Important information
CapExpand Ltd is not authorised by the Financial Conduct Authority and can only complete non-regulated introductions. We work with UK limited companies and LLPs only, for business and commercial purposes. We are not a lender and we do not provide financial, tax or legal advice. We work with a panel of lenders whose particulars are available on request, and we receive commission from the lender if a deal completes, at no cost to you. All lending is subject to status, valuation where applicable and the lender's own checks.
Registered office: Pure Offices, Lake View Drive, Annesley, Nottingham, NG15 0DT. Company No. 14433858.
CapExpand Ltd (Company No. 14433858) is a commercial finance introducer, not a lender. We are not currently authorised or regulated by the Financial Conduct Authority and do not provide financial advice. All information on this page is for educational purposes only. Funding is subject to status and lender criteria. CapExpand will receive a commission from providers at no extra cost to you.