UK interest rates reduced to 4.75% from 5%: What this means for small business owners
For small business owners in the UK, the recent news of the interest rate cut from 5% to 4.75% has come as a welcome relief. This change is the lowest level in the past year and offers real benefits for businesses looking to reduce financing costs, manage debt more effectively or explore new growth opportunities. In this blog, we’ll discuss how these reduced interest rates can benefit your business and practical steps to make the most of them.
Andrea Reynolds, CEO of Swoop, shares her perspective:
“Another rate cut is starting to provide benefits for borrowers which is great news after an eventful few weeks with Labor’s budget and the US election. We all need a little cheer heading into the weekend.”
What this interest rate cut means for small businesses
Lower interest rates mean loans are cheaper, which can have many positive impacts for small business owners. Whether you want to finance a new project, invest in property, or refinance an existing loan, these interest rate cuts can stretch your bankroll by lowering the cost of repayment.
3 key opportunities for small business owners:
With interest rates now lower, here are some practical ways to make the most of this change:
- Refinance current loans
If you already have loans or debt, refinancing at a lower interest rate can save money on monthly payments, freeing up cash flow that can be reinvested into your business. Check with your lender or talk to Swoop to see if refinancing could reduce your overall costs.
- Consider growth plans
If you’ve been putting off your growth plans due to high borrowing costs, this interest rate cut may be an opportunity to move on. Lower interest rates mean it is more affordable to access funds for growth projects such as new equipment, staff, or expansion. This could be a good time to work with your financial advisor to review the plans and see if they are achievable at the new rates.
- Exploring property investment
For businesses looking to invest in property, such as purchasing premises or expanding a location, lower commercial mortgage interest rates can make financing these projects more achievable. These deductions can help reduce the monthly costs of a mortgage, which may make owning a property a good long-term investment.
How Swoop can support you
At Swoop, we’re here to help small business owners understand their options. With our platform, you can compare financing options—from loans and refinances to commercial mortgages—tailored to your business needs.
Next Step: Maximize the Interest Rate Cut
This interest rate cut provides a valuable moment for UK small business owners to evaluate their financial strategies. Whether it’s refinancing current debt, investing in growth, or exploring property ownership, now could be an ideal time to act.
If you’re considering your financing options, visit Swoop to see how we can help. By exploring your funding options with us, you will be well positioned to take advantage of this lower interest rate environment and plan well for the year ahead.
Here’s what our team had to say about the interest rate cut:
Ciaran Burke, Co-Founder and COO at Swoop emphasized the impact of the recent changes, stating:
“After the recent budget brought bad news for many businesses, this rate cut is a welcome relief. I anticipate a surge in activity in the commercial mortgage market as savvy business owners move quickly to take advantage of the current lower rates and stamp duty regulations before they are raised in April next year.”
AnnMarie Swift, Senior Funding Manager Commercial Property at Swoop added:
“The expected, but not guaranteed, reduction in the base interest rate is a welcome relief – this is due to a calmer economic environment with the budget out of the picture, and a clearer political landscape. Lower interest rates are welcome for property-based transactions, as borrowing costs start to fall. Increased activity is expected to bear fruit”
