The key difference between secured and unsecured finance lies in whether or not an asset is used as security for the loan.
Secured finance is backed by business assets, such as property, vehicles, or equipment. Because the lender has this security, rates are often lower, and borrowing limits may be higher.
Unsecured finance doesn’t require any collateral. It’s based on your business’s financial performance and credit history. While quicker to arrange, it may come with higher interest rates or lower limits.
Each option has its place, it all depends on your goals and risk appetite.
To go further, read our guide Unsecured business loans vs. secured business loans: choose the right option for your business.