With interest rates stabilising in 2025, now could be the perfect time to rethink your business finance strategy—here’s what to consider.
As we progress through 2025, interest rates remain one of the most closely monitored indicators for businesses seeking finance. Following a period of significant rate hikes aimed at curbing inflation, the Bank of England now appears to be adopting a more stable approach — but what does this mean in practice for your business?
During 2023 and 2024, the Bank of England raised the base rate multiple times to manage inflationary pressures. These increases affected everything from mortgages to commercial loans, leading to a sharp rise in borrowing costs. However, in early 2025, the base rate has shown signs of levelling off — with some forecasts even suggesting a potential gradual decline.
If you're planning to secure business funding this year, here's how the current interest rate landscape could influence your strategy:
Should rates continue to stabilise or fall, businesses may benefit from lower monthly repayments on new finance agreements.
Stability often encourages greater confidence among lenders, potentially leading to more flexible terms and wider access to capital.
If borrowing is on your agenda, now could be a smart time to secure a fixed-rate product — particularly if there’s a chance rates may rise again in the medium term.
Provide predictability — your repayment amount remains unchanged regardless of rate movements.
May start with lower rates but carry the risk of rising repayments over time.
We’ve observed an increase in clients exploring refinancing or restructuring options to leverage this more favourable rate environment. If you're considering your next step, our team can help you assess your options and tailor a funding solution aligned with both your short-term objectives and long-term strategy.
