Revolving Credit Frequently Asked Questions

1) What is a Credit4 Facility?
A Credit4 Facility is a flexible credit line for your business. Upon acceptance, you get the flexibility to draw the funds as and when you need them. This differs from traditional term loans that provide a cash lump sum with set repayments. Unlike other lenders, our facilities require payment of interest only during the term of the agreement; and you repay the total amount drawn at the end of the agreed term, meaning that your business is not required to make regular payments of principal. The repayment of the amount drawn down at the end of the term is unlike traditional loans, where the principal is repaid gradually over the term. Consequently, your business must ensure that it is able to repay the lump sum outstanding at the end of the term. Your business will be asked to settle the interest accrued on a fortnightly basis – we will send you a fortnightly statement advising you of the interest amount and details about how to pay.
2) How much can I apply for?
Credit4 facilities are for a minimum of £15,000 and a maximum amount of £30,000.
3) What facility term can I apply for?
Our facilities are for terms of between 3 months and 12 months.
4) What can I use the funds from my Credit4 facility for?
As part of our application process we will require you to explain what you need a Credit4 facility for. Our fundamental requirement is that the facility must be used solely for the purposes of your business.
5) How much does a Credit4 facility cost?
We believe in transparent pricing so our costs are very straight forward. We will charge an arrangement fee of 4% of the amount of the facility we agree with you. Any funds you draw down under your facility are charged at the rate of 30% per annum and the interest is calculated on a daily basis. Any funds which have not been drawn down (the difference between your facility amount and what you’ve drawn) are charged at a rate of 6% per annum, this is also calculated on a daily basis (this is known as your non-utilised interest charge). In summary, 4% upfront arrangement fee, 30% per annum on drawn funds and 6% per annum on undrawn funds. No prepayment fees, no administration fees, no service charges, NO HIDDEN COSTS.

Credit4 Flexible Facility Representative Example 1

Total amount of credit (facility amount): £30,000, term 12 months.

Full facility drawn for the full 12 month term.

Arrangement fee: £1,200 (4% of facility amount fixed). Interest £9,000. Interest rate: 30%pa (fixed on drawn funds). Total charge for credit: £10,200. Representative APR: 34%

Total amount payable: £40,200

Interest is payable fortnightly and capital is repayable in one single payment of £30,000 at the end of the term.

Credit4 Flexible Facility Representative Example 2

Total amount of credit (facility amount): £30,000, term 12 months.

Facility fully drawn for 6 months (182 days) and undrawn for 6 months (183 days).

Arrangement fee: £1,200 (4% of facility amount fixed). Interest rate: 30%pa (fixed on drawn funds). Interest on utilised balance: £4,487.67. Interest rate on non-utilised balance 6%pa (fixed on undrawn funds). Interest on non-utilised balance: £902.47. Total charge for credit: £6,590.14. Representative APR: 21.97%.

Total amount payable: £36,590.14

Interest is payable fortnightly and capital is repayable in one single payment of £30,000 at the end of the term.

If you are unsure about the way in which the charges are calculated on our facilities, please feel free to give us a call on 020 3637 0570 and we will be happy to explain them.

6) How do I know if I qualify for a Credit4 Facility?
If you meet our eligibility criteria, then we are able to consider your application. You can find our eligibility criteria here enquire now. Alternatively, you can call us on 020 3637 0570.
7) What does “utilised” and “non-utilised” actually mean?
Upon acceptance of your application and completion of documentation, we will grant you a facility. This is the amount which you have stated you require for your business and that we have agreed to advance. To keep things flexible, we allow you to draw on the funds as and when you need them. The funds you draw are known as utilised whilst the funds that remain undrawn are your non-utilised funds. You can draw on your non-utilised funds at any time throughout the term of your facility, although minimum drawing amounts do apply.
8) What happens if I want to pay back amounts drawn on my Credit4 Facility?
Credit4 believe in providing flexibility and therefore you are able to repay capital amounts you’ve drawn down at any time, provided the amount repaid is at least 10% of the drawn facility amount. This will reduce the amount of interest you pay on the amount repaid from the “utilised” rate of 30% per annum to the “non-utilised” rate of 6% per annum. Should you need to redraw available funds under your facility, simply let us have the completed pre-agreed notice. Once re-drawn, these funds will then attract the “utilised” rate of 30% per annum rather than the “non-utilised” rate of 6% per annum. Provided you haven’t missed any interest payments, we aim to get the funds to you within two working days.
9) Can I cancel my Credit4 Facility?
Yes, if your facility is at least 3 months old and there are no overdue payments outstanding under it. Provided this is the case you can cancel the facility at no cost, at which point you will need to settle all amounts outstanding at the date the facility is cancelled.
10) Will you take security?
All proprietors / directors of the business applying for a Credit4 facility are required to provide a personal guarantee. Should the business that has taken the facility be unable to meet any of its obligations under the facility agreement we may require that the guarantors meet them instead. Please contact us for more information.
11) How long does the application process take?
Our eligibility checks and the initial stage of our application process should only take about 10 minutes to complete. After that stage we will contact you to discuss your suitability and requirements further and if appropriate to undertake our full application process. We aim to process applications within a matter of days of receiving all the required information. In some circumstances, we may require more information and this may delay our decision time. Your Account Manager will keep you fully informed as your application progresses. Our lending decision is made by a real person who will aim to understand your business and your requirements and this may inevitably take longer than some alternative providers of finance who let technology make the decision.
12) Can I apply for a Credit4 facility if I am a sole trader or a partnership?
Yes, provided that the facility will be used for business purposes.
13) Will I receive an interest statement?
Every two weeks, we will email you to let you know the current level of your facility along with the interest payment due. Should you have any concerns or wish to discuss your facility, you’ll be able to contact us.
14) How do I receive the funds?
Upon approval and completed documentation, we will send your funds quickly and securely to your UK business bank account.
15) I need more funds than my Credit4 Facility allows, is it possible to agree more?
Yes, provided that all your payments are up to date and have been made on time and there is a genuine business need for the additional funds. Your request will be treated in the same way as any other application. All applications for a further advance are subject to status, additional credit checks, approval and documentation.
16) What if I cannot repay my Credit4 Facility?
If you are unable to make any payment you are required to during the term of your Credit4 Facility, you will need to ensure you contact us as soon as possible.
17) How can I raise a complaint?
Credit4 will always provide the best customer service possible. However if there’s something that you’re not happy with, we would like to be able to put things right as quickly as we can.

If you want to make a complaint, please contact us in one of the following ways:

1. Send us an email at : admin@credit4.co.uk
2. Call us on 020 3637 0570
3. Write to us at Credit4, Dawson House, Jewry Street, London, EC3N 2EX

We will investigate the complaint internally and respond within 2 working days. However, if the complaint is complex it may take longer to resolve, in which case a holding response will be sent to you explaining the situation and informing you when further contact will be made.

Please note that, in accordance with regulations, we keep an up to date a report of each complaint, for a period of 5 years from the date the complaint was received.