Finance and funding for music businesses

Debt finance is money that you borrow (usually from a bank) to run your business. It covers credit in its many forms, including loans, credit cards, overdrafts, mortgages and others.

Depending on the type of loan you are seeking, debt financing can be:

• short-term - eg bridging finance such as overdrafts
• medium-term - eg term loans, asset finance and leasing
• long-term - eg mortgages and fixed asset loans
• working capital funding - eg invoice or supplier financing

You can get debt financing by application to any high street bank. Music businesses should also consider a few alternative sources of finance, including:

• creative industries funds
• community development funds

Getting bank finance for music

Music business loans are similar to other small business loans. If you apply for a music business loan, you will have to go through the same process as any other business.

The bank will generally carry out a risk assessment and evaluate you on several criteria, including:

• your financial stability
• your credibility
• your business plan
• your ability to repay
• your ability to find other investors

Before you apply for credit, think about how and when you will be able to make repayments, and if you have any savings you can use to underwrite a loan.

You will need to develop a strong business plan to support your loan request. Make sure that you write it clearly and include all the financial details of your business, such as an income statement, cash flow projections, and a balance sheet. 

Remember, if you receive credit and borrow money from a lender, you will be charged interest and expected to repay it in full.

Find out more about the different types of bank finance for businesses.