Yes, some personal loans can be used to fund a new or existing business. However, before applying for any personal loan, you should check that the lender doesn't impose any restrictions for business use. It's worth reading through the loan's conditions beforehand to see what is allowed and what isn't.
Starting a business isn’t easy. From the idea itself to its eventual conception, turning a dream business idea into something tangible and (hopefully) profitable is a feat that few can manage.
However, that is not to say it’s impossible. In today’s fast-paced world, opportunities for investment are aplenty, with seed capital, fund-raising platforms and networking opportunities available online at just the click of a button. Whether you’re starting out in business or have been established for a number of years, you might consider taking out a loan to get some extra funding for growth and other projects. But do you have to get a specific business loan to do this or is it possible to use a personal loan instead?
It’s worth reading through the loan’s conditions beforehand to see what is allowed and what isn’t. Lenders will normally explicitly say what their personal loans can be used for, and some will allow commercial uses while others will not. If you are unsure whether a lender allows you to use a personal loan for business purposes, you should be honest about your intentions as a borrower so the lender knows where they stand. Check the small print or, if you are still unclear, ask the lender, “Can you use a personal loan for a business?” instead of hiding your true intentions. If lenders find out you used a loan for a prohibited purpose, then they could make you repay the borrowed sum and the resultant interest immediately.