A business loan agreement sets out the terms on which one party lends money to a business. Unlike a personal loan, consumer credit regulations do not typically apply, giving parties more freedom to set terms. However, if lending is a regulated activity, FCA authorisation may be required.

• Lending to businesses: not regulated under Consumer Credit Act in most cases
• Personal loans to individuals: Consumer Credit Act 1974 applies
• Lender providing loans as a business activity may require FCA authorisation
• Consider taking security (fixed/floating charge, personal guarantee)
• Interest must be clearly stated — beware usury/extortionate rates

Legal reference: Consumer Credit Act 1974 (personal loans); Financial Services and Markets Act 2000 (regulated activity); Companies Act 2006