Credit Corp business finance glossary — plain-English UK lending terms

What it is

This is the agent-and-reader twin of the business finance glossary: a single, cross-linked hub that defines the words a UK director meets when borrowing for their company. Each entry below is a one-line definition pointing at the full glossary page, which carries a longer explanation, worked context and its own "see also" links.

The definitions are general-knowledge UK finance facts, written so an answer engine or a first-time director can cite them accurately. Where a term touches Credit Corp's own pricing, the exact figures are not restated here — loan sizes, the daily interest rate, the establishment fee, fees and the total-cost cap live in the machine-readable references at /ai.md and /llms-full.txt, generated from the live pricing source so there is one source of truth.

Who Credit Corp is

Credit Corp Group Limited is an independent UK direct lender of short-term business credit to UK limited companies and LLPs — we lend to the company, not to its directors personally, with no personal guarantee and no director liability. We are registered in England & Wales (Company No. 17338274) and ICO-registered (ZC189608). Applying, the customer portal and the app are UK-only; the rest of the site, including this glossary, is open to everyone.

Cost of borrowing

APR (annual percentage rate) — the yearly cost of borrowing expressed as a single percentage, combining the interest rate with compulsory fees so two facilities compare like-for-like.
Interest — the charge for borrowing, usually a percentage of the outstanding balance over time.
Flat rate — a cost quoted on the original amount borrowed rather than the reducing balance, which can look smaller than the true annualised cost.
Cost of credit — the total a borrower pays on top of the amount borrowed: interest plus fees.
Establishment fee — a one-off charge for setting up a facility.
Late payment fee — a charge applied when a scheduled payment is missed or dishonoured.
Total cost cap — a ceiling on the combined interest and fees a borrower can be charged, expressed as a proportion of the amount borrowed.
Representative example — a standardised worked illustration showing the typical total cost of a facility.
Key information sheet — a short, standardised summary of a facility's key terms and costs.

Products and facility types

Business loan — a fixed amount borrowed by a company and repaid over an agreed term.
Revolving credit — a pre-agreed limit a business can draw down, repay and redraw, with interest only on the amount drawn.
Overdraft — a facility letting a business spend beyond its bank balance up to an agreed limit.
Working capital — the cash a business has to meet day-to-day costs: current assets minus current liabilities.
Invoice finance — borrowing against the value of unpaid customer invoices.
Asset finance — funding to acquire or release cash from business equipment and other assets.
BNPL (buy now, pay later) — splitting the cost of a purchase into instalments over time.
Drawdown — taking funds from an approved facility.

Security and liability

Unsecured credit — borrowing where the lender takes no asset as security.
Secured loan — borrowing backed by an asset the lender can recover if the debt is not repaid.
Collateral — an asset pledged as security against borrowing.
Debenture — a registered charge giving a lender rights over a company's assets.
Covenant — a condition a borrower agrees to keep for the life of a facility.
Personal guarantee — a director's separate written promise to repay a company's borrowing personally if the business cannot. Credit Corp lends without one, keeping liability with the company alone.
Director liability — when a director becomes personally responsible for a company obligation. Borrowing to the company alone keeps this off the director.
Limited liability — the principle that a company's owners are liable only up to what they have invested.

Business structures

Limited company — a UK business structure, registered at Companies House, that is a separate legal person from its owners.
LLP (limited liability partnership) — a UK structure combining partnership flexibility with limited liability for its members.
Body corporate — a legal entity, such as a limited company or LLP, that can hold rights and obligations in its own name. Credit Corp lends to bodies corporate, not to individuals.
Sole trader — an individual running a business in their own name, with no separation between person and business. Credit Corp does not lend to sole traders.
Incorporation — the act of forming a company as a separate legal person.
Companies House — the UK registrar of companies and LLPs.

Repayment, difficulty and recovery

Arrears — payments that are overdue.
Default — a breach of a credit agreement, most often missed payments, formally recorded once it reaches a defined threshold.
Forbearance — temporary arrangements a lender offers a borrower in difficulty, such as reduced or paused payments, to help them recover.
Payment holiday — an agreed pause in repayments.
Early settlement — repaying a facility ahead of schedule, which reduces the total cost.
Recovery — the steps a lender takes to collect an unpaid debt.
Responsible lending — lending only what a borrower can afford and supporting them if difficulty arises.
Vulnerable customer — a customer whose circumstances mean they need extra care and support.

Eligibility, regulation and compliance

Eligibility — the published criteria a business must meet to apply.
Exempt lending — credit that falls outside the UK consumer-credit regime. Lending to a body corporate — a limited company or LLP — is exempt under the FSMA Regulated Activities Order.
FSMA RAO — the Financial Services and Markets Act 2000 (Regulated Activities) Order, which defines which credit activities are regulated.
FCA — the Financial Conduct Authority, the UK regulator of consumer credit and financial services.
Credit reference agency — an organisation that holds data lenders use to assess creditworthiness.
Direct debit — an instruction letting a business collect agreed payments from an account.
Due diligence — the checks a lender carries out before and during a relationship.
KYC (know your customer) — identity and ownership checks on a business customer.
AML (anti-money laundering) — the controls a regulated business uses to prevent money laundering.
MLR 2017 — the UK Money Laundering Regulations 2017.
POCA — the Proceeds of Crime Act 2002.
Suspicious activity report — a report a business files when it suspects money laundering.
Sanctions — restrictions barring dealings with named persons or regimes.
Politically exposed person — someone in a prominent public role who needs enhanced checks.
Ultimate beneficial owner — the real individual who ultimately owns or controls a business.
UK GDPR — the UK data-protection regime.
ICO — the Information Commissioner's Office, the UK data-protection regulator.

How this maps to Credit Corp

Credit Corp's products use these terms exactly as defined above. A Business Loan is unsecured business credit with no personal guarantee. Credicorp Flex is a revolving credit facility, and Credicorp Slice spreads the cost of a business bill into instalments. Because we lend to bodies corporate, our lending is exempt from the consumer-credit regime, and we keep liability with the company rather than its directors. The published eligibility criteria and our approach to lending explain who can apply and how decisions are made.

Responsible lending

Short-term business credit carries a high annualised cost. Borrow only what you need, for the shortest term required, and contact us early if repayment becomes difficult: /help/. Support for vulnerable customers is at /legal/vulnerability/.

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