Capchase business loans: Rates & eligibility

Capchase was founded in 2020 with the aim of establishing improved funding options for Software as a Service (SaaS) businesses that often found it difficult to access traditional finance.

Since launching, the company has expanded rapidly and now operates in the UK, USA, Canada, Spain, Belgium, Netherlands, Finland, Sweden and Ireland.

An overview of Capchase business loans

Capchase is a financing provider aimed at recurring-revenue businesses, particularly SaaS companies. Instead of offering traditional business loans, it provides tools that help vendors unlock upfront capital or offer more flexible payment terms to their customers. Its products fall into three main categories:

Capchase Pay (Buy now Pay Later – BNPL)

This is a payment tool that lets vendors offer flexible payment terms to customers for annual or multi-year contracts. It integrates into the vendor’s sales process and allows customers to choose a monthly, quarterly or semi-annual plan.

Capchase pays the vendor the full contract value upfront and handles all billing and collections, allowing vendors to invest in their business without waiting for payment. Meanwhile, buyers get to spread the cost and preserve working capital.

Capchase Grow

This is a revenue-based financing facility for companies with predictable revenue streams, such as SaaS or subscription models. Businesses can access upfront capital based on future contracted revenue and use it to invest in hiring, marketing or product development, without giving up equity in the company.

Capchase Expense Financing

This enables vendors to spread the cost of large operational business expenses, such as cloud hosting services, legal bills or other software subscriptions with flexible repayment terms. Repayments are made over time, helping smooth out cash flow.

What is Capchase’s typical interest rate?

Because Capchase’s products don’t operate like a standard bank loan, it often charges a financing fee rather than an annual percentage rate (APR). The fee you pay will depend on the type of finance you use, and you may need to pay a platform fee on top.

How much can I borrow with a Capchase business loan?

The amount you can borrow through Capchase is typically a proportion of your annual revenue and will therefore depend on how much revenue you generate. Higher and more predictable recurring revenue usually results in larger funding amounts, while businesses with fluctuating or seasonal income may be offered a smaller amount. It may also depend on factors such as the size of your business, your business’s financial standing and trading history.

What is the acceptance rate for a Capchase business loan?

Capchase doesn’t publish its acceptance rates. But in general, you’re more likely to get accepted if you meet the eligibility criteria, have a strong financial history and complete the application process accurately.

Note that Capchase doesn’t carry out a hard credit check. Instead, it conducts a “behind the scenes” eligibility check to ensure a customer is an incorporated business, meets Capchase’s requirements and has no fraudulent activity to its name.

Eligibility criteria and whether you qualify

Eligibility criteria can differ slightly depending on the type of product.

For Capchase Grow, you generally need to be operating a recurring-revenue business, and you may also need to meet a minimum annual recurring revenue requirement.

For Capchase Pay, eligibility depends on the vendor’s customer (the buyer). In this case, the buyer must have been in business for at least six to 24 months, depending on the program, and have at least two employees. The buyer must also be an incorporated company and located in a supported country, such as the UK or USA. The buyer will also need to undergo a financial review.

Keep in mind that because Capchase’s products are often tied to revenue performance, they are best used for short-term cash flow tools, rather than long-term financing. If your business is experiencing rapid growth, you might find it useful to unlock future revenue during expansion phases. But Capchase’s products may not be so suitable for businesses with seasonal income.

Additional information

Before setting up a finance plan with Capchase, it’s important to read through the small print and keep the following in mind:

Early repayment fees

As Capchase doesn’t offer traditional fixed-term business loans, traditional early repayment charges won’t apply. But you should still check your agreement to ensure you know what fees could apply and when – such as a platform fee and a financing fee.

How long does it take to get approved?

Capchase says businesses can be approved for financing in less than a day, so the process is generally fast. To increase the chances of this happening, be prepared to share all the relevant information and documentation as quickly as possible.

Estimated time to receive funds

The time it takes to receive your funds depends on the product, but generally this should be within one to three business days after approval.

Is security required?

No, you won’t need to provide security to get finance from Capchase, and there’s no need to provide a personal guarantee either (stating you become responsible for repaying the loan if the business can’t).

What documentation is required

You’ll need to provide the necessary documentation and information when applying for finance with Capchase.

Business information

You will need to provide information such as your company name and address, your company website details, and length of trading. You may also be required to supply certain financial documents, such as bank statements, cash flow forecasts and balance sheets.

Business owner information

All business owners will typically be asked to supply their name and address, email address and phone number.

Funding requirement

You will also need to state how much funding you wish to apply for and why.

How to apply for a Capchase business loan

As a first step, you have the option to book a call online. You’ll need to provide some information and then schedule a meeting with the team to discuss financing, payment solutions or a demo.

You can also create an account on the website by using your email address and creating a password. Alternatively, you may be able to sign up through certain integrations such as Google, Xero or Stripe. You’ll need to provide basic contact information as part of this process.

You then select which products you wish to apply for, and Capchase requests access to your financial information, either through accounting or billing tools, or through a manual upload. Capchase reviews this information, and while you’re waiting, you’ll have access to the Capchase platform to start familiarising yourself with how it works.

Is the application process different to other lenders?

Capchase doesn’t work like a traditional lender as it doesn’t offer standard term business loans. Instead, you’ll need to apply online and then supply certain financial information before being told whether you’ve been approved. If you are approved, you’ll receive an offer at this point.

The whole process can be completed within a few days, which is typically much faster than traditional high street lenders.

However, keep in mind that Capchase differs from banks by focusing on your business’s future revenue rather than your past profitability. This can be an advantage for fast-growing SaaS businesses with limited assets. However, banks may still offer cheaper finance if your business has a strong balance sheet, physical assets or long trading history.

How to improve your chances of getting funded

The best way to improve your chances of getting funded is to ensure you answer questions accurately and honestly and supply any requested documentation or information quickly.

Pros & cons of a Capchase business loan

Some of the pros and cons of applying for finance with Capchase are as follows:

Pros

Quick and easy to apply and get approved
Range of finance options available
No need to give up ownership in your business or provide security

Cons

Fees apply
Won’t be the right choice for all business types
You’ll need predictable recurring revenue to qualify

Alternative funding options for different lenders

If you don’t feel the financing options available from Capchase are right for your business, there are plenty of alternative funding options to explore from other lenders. These include:

Why use a finance broker?

Working with a finance broker can make finding the right funding much faster and more efficient. Brokers have access to a wide panel of lenders and can help you find options to match your business profile, which is particularly important if your business is new or if it has a poor credit history.

A good broker will explain any fees upfront and guide you through the application process from start to finish. Some brokers charge a flat fee for their services, while others earn a commission from the lender, so it’s important to understand the cost structure before you proceed.

Get started with Swoop's business funding platform

Our team at Swoop would be happy to discuss your business funding requirements with you to help you find the right deal to support your application and help your business grow.

Capchase business loan review: Interest rates, eligibility, and the application process