Funding Circle vs Allica Bank: UK SME term loans compared 2026
Two lenders that look similar from the outside (term loans for established Ltd companies) but answer different questions. Funding Circle is the largest UK SME unsecured term-loan platform, fast and fintech-led. Allica Bank is a PRA-regulated SME challenger bank focused on £150k-£5m asset-backed lending. Different ticket bands, different underwriting depth, different products despite the surface overlap.
Quick verdict
- Pick Funding Circle for £10k to £150k unsecured working-capital and term loans you need decided this week.
- Pick Allica Bank for £250k+ asset-backed deals where rate and underwriting depth matter more than speed.
- Below £150k Allica will not engage; above £500k Funding Circle is rarely the strongest priced option.
Side-by-side
| Funding Circle | Allica Bank | |
|---|---|---|
| Product type | Term loan | SME term loan + commercial mortgage |
| Founded | 2010 | 2019 |
| Ticket range | £10k to £500k | £150k to £5m |
| Typical rate | 6.9% to 26.9% APR | From 7.99% APR |
| Decision time | 1 to 3 business days | 5 to 10 business days |
| Soft search at quote | Yes | No |
| Limited companies only | No | Yes |
| FCA regulated | Yes | Yes |
| Companies House | 07123069 | 11470391 |
| Overall rating | 4.3 / 5 | 4.4 / 5 |
| Rate transparency | 4/5 | 5/5 |
| Eligibility clarity | 5/5 | 4/5 |
| Decision speed score | 4/5 | 3/5 |
| Decline handling | 4/5 | 4/5 |
Product overview
Funding Circle
Funding Circle is the largest UK SME term-loan platform, founded 2010, FCA regulated, with tickets from £10k to £500k and decisions in one to three business days. The published rate range (6.9% to 26.9% APR) is wide, so the headline number is rarely the offered number. Best fit: established Ltd companies with 2+ years of trading, clean credit and turnover above £100k. Companies House 07123069.
Allica Bank
Allica Bank is a PRA-regulated UK challenger bank founded 2019, focused on the £150k to £5m SME ticket band that mainstream high-street banks have abandoned. Rates start from 7.99% APR for SME term loans and commercial mortgages. Pricing is competitive and rate transparency is excellent, but decision speed (5 to 10 business days) lags fintech alternatives. Best fit: established Ltd companies trading 2+ years needing asset-backed facilities at £250k or above. Companies House 11470391.
When Funding Circle wins
- You need a decision in 1 to 3 business days, not two weeks.
- Your ticket sits in the £10k to £150k band where mainstream banks have largely retreated.
- You are happy with unsecured lending against a director PG.
- You want soft-search at quote so you can shop without a credit-file footprint.
When Allica Bank wins
- You need £250k+ for a structured deal: commercial property, asset acquisition, owner-occupied premises.
- You value real underwriting depth over fintech speed.
- You want PRA-regulated bank counterparty with FSCS protection on linked accounts.
- Your business is asset-backed and you want pricing that reflects the security, not unsecured-platform pricing.
Cost comparison on a £250k ask
On a £250,000 commercial-property-backed ask over 5 years, Allica Bank typically prices from 7.99% APR (around £52,000 total interest), reflecting the asset security. Funding Circle on the same ticket as unsecured term lending typically lands 11% to 18% APR depending on credit profile (around £75,000 to £125,000 total interest). Funding Circle decides in days, Allica takes weeks. The maths almost always favours Allica when the deal can be structured around an asset; Funding Circle wins when speed or unsecured structure is the binding constraint.
FAQ
Is Allica Bank a real bank, and Funding Circle is not?
Correct. Allica is PRA-regulated with a full UK banking licence (Allica Bank Limited, company 11470391), so linked accounts attract FSCS deposit protection. Funding Circle is FCA-authorised but not a deposit-taking bank; it operates as an SME lending platform and is publicly listed.
Why is Allica's minimum £150k when Funding Circle starts at £10k?
Allica targets a different segment: established SMEs needing serious facility size for asset-backed lending and commercial mortgages, where high-street banks have largely retreated. Funding Circle covers the unsecured working-capital and term-loan band high-street banks find too small to underwrite manually.
Which is faster, Funding Circle or Allica Bank?
Funding Circle by a clear margin. Funding Circle decisions land in 1 to 3 business days; Allica takes 5 to 10 business days because a real underwriter is assigned to the case. The speed gap is the price of Allica's deeper underwriting.
What credit profile does each prefer?
Funding Circle prefers 2+ years trading, clean credit, turnover above £100k, and will hard-decline CCJs. Allica goes deeper on the financials but engages with asset-backed cases that mainstream banks decline on covenants alone. Neither is a post-decline lender.
Can the same business apply to both?
Yes if the ticket size fits. Below £150k, Allica will not engage so Funding Circle is the route. Above £250k with property or other assets, Allica typically prices better and structures the deal around the asset.
Related comparisons
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Open our /get-quotes/ form →Reviewed by Oliver Mackman, Director. Last reviewed: 2026-05-07.