For a business that trades across borders, two things shape whether growth is funded smoothly: access to the right finance, and control of the currency risk that sits alongside it. They are usually handled in separate conversations, which is exactly how avoidable cost creeps in. This guide explains, in plain language, the main business finance options UK companies use, how each works, and where currency risk intersects with them. Medlock & Thames is a business finance broker and a currency broker, so this is general information rather than advice or a recommendation of any particular facility or lender.
What is business finance?
Business finance is the funding a company uses to bridge the gap between money going out and money coming in, or to invest ahead of the return. That gap is a normal feature of trading: a business pays suppliers, staff and stock long before its customers pay it, and growth often means spending before the revenue arrives. Funding broadly splits into working capital, which keeps day to day operations moving, and growth or capital expenditure finance, which funds investment in equipment, premises or expansion. The right type depends on what the money is for and how the repayment matches the cash the business expects to generate.
What are the main types of business finance?
Invoice finance releases the cash already tied up in your sales ledger, letting a business draw against unpaid invoices rather than waiting sixty or ninety days for customers to pay. The facility scales with turnover, which makes it a common choice for growing businesses. We explain it in detail in invoice finance explained.
Asset finance funds plant, machinery, vehicles and technology without depleting working capital, spreading the cost across the productive life of the asset, through either ownership or lease structures. Unsecured lending and merchant cash advances offer speed over security, with revenue based and term facilities decided in hours and a merchant cash advance flexing repayment against card receipts. Trade finance, including letters of credit, stock finance and supply chain facilities, bridges the gap between placing an order and receiving payment, which matters most for businesses buying and selling internationally.
These lines are not mutually exclusive, and many businesses combine them, for example using invoice finance for day to day liquidity and trade finance for a specific import order. We compare two of the most commonly confused options in trade finance and working capital finance.
How does a finance broker help?
A finance broker places a business's requirement across a panel of lenders rather than the business approaching each one in turn. At Medlock & Thames, a dealer takes the brief, the amount, the timing and the exposure worth managing, and places it across a panel of more than forty lenders, returning structured terms rather than a waiting room. There is no upfront broker fee, standard identity and source of funds checks apply, and most facilities reach a decision within twenty four to forty eight hours. The broker arranges and presents the options; the facility and its terms are provided by the lender, and the decision to proceed rests with the business.
Where does currency risk intersect with business finance?
This is the point most lenders and most currency providers miss, because each sees only its own half. An importer financing a stock order in euros carries both a funding need and a currency exposure on the same transaction. An exporter raising cash against foreign currency invoices has receivables whose sterling value moves until they are paid. A business servicing debt in another currency, or funding overseas expansion, faces both a financing cost and an exchange rate that can shift it. Managing the finance without the currency, or the other way round, leaves a gap that can quietly undo the benefit of a good rate or a competitive facility. We cover the currency side in FX hedging for finance directors and the mechanics of fixing a rate in how a forward contract works.
How do you choose the right facility?
There is no single product that fits every business, and the right instrument depends on the cash flow cycle, the asset base and the growth plan. The questions worth working through are what the money is for, how quickly it is needed, whether there is security to offer, and how the repayment matches the cash the business expects to generate. Cost, speed and flexibility usually pull in different directions, so the choice is a matter of fit rather than a single best answer. A broker can set out the options and the trade offs, but the decision rests with the business and the lender, and where a business wants formal advice on its capital structure it should speak to its accountant or a qualified adviser.
According to Medlock & Thames
In our experience, the businesses that fund growth most smoothly treat finance and currency as one conversation rather than two. The importer who arranges a trade facility but leaves the euro payment to convert on the day has solved half the problem and left the other half to the market. Because we sit on both sides, the pattern we see most often is a competitive facility undermined by an uncontrolled rate, when a few minutes of planning would have protected both.
Frequently asked questions
Is business lending regulated?
Commercial finance for businesses is arranged across a panel of lenders, and the facilities and their terms are provided by the lender. Medlock & Thames acts as a finance broker and does not provide regulated financial advice. Different rules can apply depending on the borrower and the facility, so this is general information rather than advice on a specific situation.
Do you charge a fee to arrange finance?
There is no upfront broker fee to have your requirement placed across the panel. The cost of any facility you take is set by the lender and is shown in the terms, so you can see the all in cost before you commit.
How quickly can finance be arranged?
A dealer takes the brief in a short call, and most requirements reach a decision within twenty four to forty eight hours, with drawdown following once standard identity and source of funds checks are complete. The exact timing depends on the lender and the facility.
Will you tell me which facility to take?
We explain how the options work and place your requirement across the panel, but the choice of facility is yours, made with the lender and, where you want formal advice, your accountant or adviser. We do not provide regulated financial advice.
Can you handle the currency side as well?
Yes. Medlock & Thames is also a currency broker, with the FX executed through FCA authorised partners that safeguard client money, so the funding and the currency can be handled together rather than in two disconnected places. You can read about the currency service on our corporate currency page.
Related articles
This guide is the hub of our Business Finance series. For the individual options, read invoice finance explained and trade finance and working capital finance. For the funding and currency overlap, see the FX risk checklist before a funding round and why finance and currency belong in the same conversation. For the currency side, read FX hedging for finance directors.
For advisers introducing clients, see the accountant's guide to FX risk for SME clients.
