Securing a business loan for a restaurant, bar or pub in England or Wales can be frustrating. Hospitality businesses are often viewed as higher risk due to seasonal trading patterns and rising operating costs, often at no fault of the business owner or consumer.  

However, with the right preparation and the right lender, funding for refurbishment, expansion or more staff can be well within reach. We’ve asked our development management and leadership teams to share their insights on how alternative loans can help support hospitality businesses across England and Wales and how you can apply.   

The current hospitality landscape in England and Wales 

In 2025, there were over 176,000 hospitality businesses operating in the UK, according to data from the Office for National Statistics (ONS), with 99.6% of them being small or medium-sized businesses.  

Rising rates and operating costs continue to put pressure on entrepreneurs and business owners across both urban and rural areas. Analysis from UKHospitality suggests that as many as six hospitality venues could close each day in 2026 if financial pressure continues.  

Why do restaurants, pubs and bars in England and Wales need business loans? 

Hospitality businesses typically seek finance through business loans for three main reasons: refurbishment costs, site expansion, or short-term cash flow support for projects. This can support:

• Leasing, renting or buying a commercial space 
• Renovating a new space 
• Redecoration or upgrading furnishings 
• Fitting kitchen equipment and appliances 
• Purchasing licences and permits for music, hygiene and alcohol 
• Point of sale and internal technology like tills, customer ordering apps or kitchen systems 
• Bridge a gap for funds during slower trading periods 
• Expanding sites, opening a pop-up or launching takeaways 
• Improving marketing presence like menus, social media and external displays 
• Employ more kitchen, bar or management staff 

A business loan provides the capital needed to act quickly and be one step ahead of your competition.  

As policy discussions continue and access to traditional bank lending becomes tighter, many restaurant, pub and bar owners are exploring alternative finance options to support refurbishment, growth or cash flow.  

What types of business loans for restaurants are available? 

Hospitality businesses, like restaurants, cafés, pubs, hotels, and bars, may be eligible for a range of business loans, such as:

• Traditional bank loans: Sometimes referred to as high-street lending, as it’s offered by most high-street banks. Requires a strong credit history and sometimes security. 
• Government-backed loan schemes: Delivered through accredited lenders, like funding managers, supported by the British Business Bank. These programmes help smaller businesses that may struggle to access traditional funding sources. 
• Asset finance: Usually used for kitchen equipment, coffee tools, furniture or vehicles. The asset itself often secures the borrowing. 
• Trade credit: An agreement with a supplier to arrange payment schedules, typically in 30, 60 and 90 days. Often used to purchase stock and access supplies up front, paying later on. 
• Equity finance: If you’re looking for a solution that avoids taking on any new debt, venture capitalists, angel investors and crowdfunding can be another way to seek investment. Unlike loans, equity finance means giving up a share of ownership and future profits. 

The loans available to you will also depend on the area your business is based in. For instance, if you’re applying for a government-backed loan, Welsh businesses may be eligible for the Investment Fund for Wales (IFW), and businesses in the West Midlands may be able to access the Midlands Engine Investment Fund II (MEIF II) alongside the Community Investment Enterprise Fund (CIEF) in both areas. 

What do lenders look for when applying for a hospitality business loan in England and Wales? 

Lenders will usually ask hospitality businesses for:

• Your business details and mission  
• Your most recent business and market plan  
• How your cash flow is performing and financial statements  
• If you have any existing finance or loans  
• Your credit history and if you have any CCJs, defaults or arrears   
• If you have any collateral  

We put together a simple 3-step guide on how to apply for a small business loan in England and Wales, which explains how to align your business goals, what information you need, and how to find the most suitable lender. 

Can you get a business loan to open a bar, restaurant or pub from scratch?  

Yes, some lenders will offer business loans to start-up restaurants in England and Wales, but approval criteria may be stricter. Lenders typically need to see a detailed business plan with a cash flow forecast, as well as any industry experience. 

If you have a business that is not yet trading but is ready to start up (also known as a feasible business), you may have fewer loan options to choose from depending on lender eligibility. This is because start-ups are considered higher-risk and have no proven repayment ability. 

It’s BCRS Business Loans’ vision to support any viable business across these two regions. So, if your restaurant business is viable, has a competitive edge and sustains itself, you’re more likely to meet lender criteria.  

Why do restaurant loan applications get rejected? 

Business loan applications for restaurants or other hospitality businesses may be rejected because of:

• Specific lender eligibility criteria not being met 
• No or minimal trading history 
• Excessive debt which affects repayment requirements 
• Missing or incomplete financial documents 
• An unrealistic or unviable business plan 

If a traditional lender, like a high-street bank, rejects your loan application, an alternative lender may be able to help. These are often Community Development Financial Institutions (CDFIs) and take a less statistical, more human approach to how you can be supported in your loan process.  

How much can you borrow for a business loan in hospitality? 

There are no specific figures for how much you could borrow for your restaurant, pub or hotel. The amount you can borrow depends on your turnover, affordability to repay and your trading history. Your credit score will also be considered, but it is possible to secure a loan and have bad credit.  

At BCRS Business Loans, funding typically ranges between £10,000 and £250,000 for hospitality businesses across England and Wales. Here are three different hospitality businesses that successfully applied for a loan:  

When applying for a loan with BCRS, you’re not just receiving a sum of money; you work with a dedicated business development manager who looks at the viability of your business as well as your financials. We understand that this isn’t just a business venture for you, and we’re here to support you where it matters most.  

Apply for a hospitality business loan today  

If you’re actively seeking up to £250,000* to grow your hospitality business or are unsure about your funding needs, speak with our team today to discuss the options available to you.  

With over 23 years of experience supporting SMEs, you’re in safe hands. 

*Credit is subject to status. Credit checks, affordability assessments, and terms and conditions apply.  

FAQs