How the Next Budget Could Shift Commercial Lending
Budgets come around faster than you can say “interest rate rise”, and this year’s is shaping up to be a big one for UK businesses. Whether you run a construction firm juggling invoices or a professional practice eyeing up expansion, the upcoming Budget could quietly (or not so quietly) reshape how commercial lending works - and how much it costs to borrow.
So, before the Chancellor grabs that red briefcase, let’s unpack what might be coming and what it means for business finance.
The State of Play: Lending is Tight, Confidence is Wobbly
Let’s be honest - the lending landscape hasn’t been the friendliest lately. Interest rates may be stabilising, but they’re still far from the ultra-low world we all got used to. Lenders are cautious, affordability tests are stricter, and valuations are, let’s say, optimistic at best.
The good news? Businesses are adapting. Many are refinancing smartly, shopping around for better terms, or exploring alternative finance routes such as asset-backed lending or invoice finance. But with the Budget looming, the next move from Westminster could either give lending a boost - or tighten the purse strings further.
What the Budget Might Bring
Here’s what’s being discussed across the finance desks right now:
Business rate reforms: Rumours suggest tweaks to commercial property rates, which could impact how lenders value certain sectors, especially retail and industrial.
Support for SMEs: Expect renewed pressure to improve access to growth funding for small and medium-sized businesses - potentially through extended government-backed schemes.
Tax incentives for investment: Any shifts in capital allowances or investment incentives could influence borrowing appetite for equipment or expansion projects.
Fiscal restraint or stimulus: The big one. A tight Budget could slow spending and make lenders more cautious; a looser one could drive optimism and credit growth.
What This Means for Borrowers
If you’re considering raising finance - whether for growth, acquisition, or refinancing — timing and preparation are everything.
Here’s how to stay ahead:
Review your lending terms now. Lock in favourable rates before any post-Budget market volatility.
Get your paperwork in order. Lenders are still picky - up-to-date management accounts and clear cashflow forecasts go a long way.
Think strategically. Don’t just chase the cheapest rate; structure your borrowing to support long-term stability.
Explore your options. The commercial finance market is diverse, from traditional banks to private lenders and niche funding specialists.
Work with an expert. A good finance broker can help you navigate changes quickly when the Budget dust settles.
Our Take
At Otium Partners we don’t have a crystal ball - but we do keep our ear to the ground. The UK market’s been through enough turbulence to know that proactive planning beats reactive panic every time.
The Budget might bring new incentives, new challenges, or both, but one thing’s for sure: businesses that plan their funding strategy now will be the ones who stay ahead.
Ready to Talk Strategy?
If you’d like to review your commercial finance position before the Budget hits, we’re here to help.
We’ll walk you through your options, spot opportunities for refinancing, and make sure you’re ready… whatever the Chancellor decides to announce.
Book a chat today and make sure your finance plan is as resilient as your business.
Email: pa@otiumpartners.com