A bank loan is an amount of money borrowed from a bank, for a set period, within an agreed repayment schedule.
The repayment amount will depend upon the size and duration of the loan and the rate of interest.
Banks usually charge interest on any loans that you get, but the terms and price will vary between the different lenders.
Different types of bank loans available include:
- working capital loans – for short notice or emergency situations
- fixed asset loans – for buying assets where the asset itself is used as a collateral
- factoring loans – loans based on money owed to your business by customers
- hire purchase loans – for long-term purchase of assets such as vehicles or machinery