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Short-term loan vs a merchant cash advance.
Both put working capital into the business now, but they're repaid in completely different ways. One is a fixed amount over a fixed term; the other is a slice of every card sale. Credicorp offers the fixed-term loan — not the cash advance. Here's how they compare, and when an MCA is the better tool.
The headline question here is repayment. A short-term loan repays a set amount over a set term, so you know where you stand from day one. A merchant cash advance takes a percentage of your card takings until it's cleared, so what you repay moves with your sales. Which suits you depends on how steady — and how card-based — your income is.
Creditcorp is the growing name for the Credicorp group, and Credicorp Limited is the lender behind it. To be clear from the outset: Credicorp offers the fixed-term Business Bridging Loan; it does not offer merchant cash advances. An MCA is repaid from card takings and comes from a specialist provider. This page is a guide, not an application — when you're ready, applying happens on the lender's own site, credicorp.co.uk.
Throughout, the borrower is the company — a UK private limited company (Ltd), LLP or PLC — not the director who signs. No personal guarantee, no charge over a home, no personal credit check on a director. These are not personal loans, payday loans or sole-trader finance.
Side by side
The Credicorp figures are the lender's published terms and can change — check the live product page before you apply. MCA terms vary by provider, so treat that column as a general picture, not a quote.
| Business Bridging Loan (Credicorp) | Merchant cash advance (an MCA provider — not Credicorp) | |
|---|---|---|
| Shape | A fixed-term lump sum | A lump sum repaid from card takings |
| Amount | £50 – £500 | Usually sized to your card turnover |
| Repayment | A set amount over a set term | A fixed percentage of daily card sales |
| Term | 14 – 84 days, fixed up front | No fixed end date — it ends when the advance clears |
| Pricing | 0.25% per day on the outstanding principal | A factor or flat fee on the advance, with no fixed term |
| Set-up fee | £5 | Varies by provider |
| Cost is known up front | Yes — fixed sum, fixed term | The fee is known; the effective cost depends on how fast takings clear it |
| Cost cap | Total cost never exceeds 100% of the principal | No standard cap; set by the provider |
| Needs card takings | No — it doesn't depend on how you get paid | Yes — repayment comes from card sales |
| Best for | A known cost with a clear, fixed repayment | Card-heavy, seasonal income that you want repayment to track |
| Personal guarantee | None | Often required — check the provider's terms |
| Borrower | The company | The company (often with a director's guarantee) |
Where they really differ
Three differences matter most: how repayment behaves, how the cost works out, and what your income looks like.
Repayment — fixed versus flexing with sales
This is the real divide. A Bridging Loan repays a set amount over a set term, full stop — predictable, finite, and the same whether trade is brisk or slow. A merchant cash advance takes a percentage of every card payment, so a busy week clears more and a quiet week clears less, with no fixed end date. If you want certainty, the loan delivers it; if you want repayments that breathe with your takings, the MCA does.
Cost shape — countable versus pace-dependent
With the Bridging Loan you can total the cost on day one: 0.25% per day on the principal, a £5 fee, capped at 100% of what you borrow. An MCA's fee is fixed at the outset too, but because there's no set term, the effective cost depends on how quickly your card takings clear it — clear it fast and it's keener; let it run slowly and it's dearer in real terms.
Your income — any company versus card-led trade
A Bridging Loan doesn't care how you get paid; it suits a company whether takings come by card, transfer or invoice. An MCA only works if a good share of your revenue runs through a card terminal, because that's the stream it's repaid from. For a card-led shop, café or salon with seasonal peaks, that alignment is the whole point; for a business paid mostly on invoice, it simply doesn't fit.
When each one wins
Neither is better in the abstract. It comes down to whether you want a fixed repayment or one that tracks your card sales.
A merchant cash advance fits better when…
A large share of your income comes through a card terminal, trade is seasonal or lumpy, and you want repayments that ease off in quiet weeks and pick up in busy ones. For card-led trade with uneven takings, that alignment is genuinely useful.
→ A merchant cash advance (from an MCA provider)A short-term loan fits better when…
You want certainty and a clear end date — a known figure, a fixed term, a total you can budget — and you'd rather repayment didn't depend on card sales. You also want the company to be the only borrower, with no personal guarantee.
→ Credicorp Business Bridging LoanThe company borrows — not you
This is one place the two genuinely part company. Merchant cash advances frequently come with a director's personal guarantee attached — the provider wants a name behind the advance. The Credicorp Bridging Loan is the other way round: the agreement is between Credicorp Limited and your company, so the finance doesn't add to what's pinned to your own name.
- No personal guarantee — the company is the borrower, full stop.
- No charge over your home — your house isn't security for working capital.
- No personal credit check on a director — the lender looks at the business, not your own file.
- Bodies corporate only — UK Ltd, LLP or PLC, never a sole trader or an individual.
This is exempt business lending under Article 60B of the FSMA Regulated Activities Order 2001, not consumer credit. The full regulatory position is set out on the group site, creditcorpgroup.co.uk.
A worked example
An illustration, not a real customer — just to show the shape of the choice.
A trading company needs £400 to cover a one-off supplier deposit this week, with the cash that clears it landing in about six weeks when a confirmed customer pays. Most of the company's income arrives by bank transfer on invoice, with only a small share taken by card at the counter.
Because the need is a known figure with a clear repayment in view, and the business isn't mainly card-led, a fixed-term Business Bridging Loan fits cleanly: a set sum over a set term, the cost visible up front and capped, settled when the customer pays — and the agreement is with the company, so the director gives no personal guarantee. Had this instead been a card-heavy café with seasonal takings wanting repayments that flex with a quiet winter, a merchant cash advance tied to card sales would have been the more natural fit.
Common questions
The questions directors ask when weighing the two. For anything specific to your business, the lender's team are at credicorp.co.uk.
Does Credicorp offer a merchant cash advance?
No. Credicorp offers three products — a Business Bridging Loan, the revolving Credicorp Flex facility and Credicorp Slice — and a merchant cash advance is none of them. An MCA advances a lump sum that you repay as a fixed percentage of your daily card takings, and it comes from a specialist MCA provider, not from Credicorp. If a repayment that rises and falls with your card sales is what you want, an MCA may suit you better, and this page is meant to help you see that clearly.
What is the real difference between the two?
How you repay. A Business Bridging Loan is a fixed-term company loan: you repay a set amount over a set window of 14 to 84 days, with the cost known on day one. A merchant cash advance takes a slice of every card payment until the advance plus its fee is cleared, so the amount you repay each day moves with your takings, and there is no fixed end date — a strong week clears it faster, a quiet one slower. One is fixed and finite; the other flexes with your sales.
When is a merchant cash advance the better choice?
When your income is heavily card-based and genuinely seasonal or lumpy, and you value repayments that breathe with your takings. Because an MCA takes a percentage of card sales, quiet days cost you less and busy days more, which can ease pressure in a slow stretch. If most of your revenue comes through a card terminal and you want repayment to track that, an MCA is built for exactly that pattern.
When does a short-term business loan fit better?
When you want certainty and a clear end date. A Business Bridging Loan tells you the amount, the term and the total cost up front, capped at 100% of what you borrow, and it does not depend on card takings — it suits a company whether or not it takes much by card. If you can name the figure and want a fixed, finite repayment rather than an open-ended slice of every sale, the fixed-term loan is the cleaner fit.
How does the cost compare?
They are quoted differently, so compare with care. The Bridging Loan charges 0.25% per day on the outstanding principal, with a £5 fee and the total capped at 100% of the amount borrowed — a figure you can total up in advance. A merchant cash advance is usually quoted as a single factor or flat fee on the advance, with no fixed term, so the effective cost depends on how quickly your card takings clear it. Faster clearance is cheaper in real terms; a long, slow repayment is dearer.
Will I have to give a personal guarantee?
Not with Credicorp. The Business Bridging Loan agreement is between Credicorp Limited and your company — a UK limited company, LLP or PLC — so there is no personal guarantee, no charge over a home and no personal credit check on a director. Merchant cash advances frequently come with a director's personal guarantee attached; worth checking the provider's terms before you assume the two are alike on that point.
Is this consumer credit or a payday loan?
Neither. This is business credit to a body corporate, not consumer credit, and it is not for sole traders or anyone borrowing in their own name. Under Article 60B of the FSMA Regulated Activities Order 2001, lending to a UK company sits outside the consumer-credit regime. The full position is on the group site, creditcorpgroup.co.uk.
More general questions are answered on the FAQ, and the whole journey is on the how-it-works overview.
Other comparisons
If you're weighing a longer loan or a buffer on the account instead, these may help.
- Business Bridging Loan vs an SME term loan — a short bridge against a longer term loan.
- Business Bridging Loan vs a business overdraft — a fixed-term lump sum against an on-demand buffer.
- The three Credicorp products, side by side — Bridging Loan vs Flex vs Slice.
Or see all three Credicorp products on the products page, and compare them on credicorp.co.uk/compare.
Ready when you are
If the Bridging Loan is the right fit, applying, drawing down and managing your account all happen on the lender's site, credicorp.co.uk.