UK SME Lending Glossary
Concise, working definitions of terms every UK fintech lender, BD, compliance officer, and data engineer should know. Updated as the regulatory landscape moves.
SIC code
The Standard Industrial Classification code — the 5-digit identifier UK Companies House uses to label every company's industry. The backbone of any lender's ICP filter.
Companies House
The UK government registrar of every limited company. Free REST API, public-by-statute data, the highest-quality "just incorporated" trigger for lenders.
FCA-regulated lender
What it means to be authorised by the Financial Conduct Authority — and which SME lending activities sit inside vs outside the FCA perimeter.
GDPR for lead generation
How UK GDPR and the Data Protection Act 2018 apply to B2B borrower-intent data — legitimate interest, controller obligations, and the public-data carve-out.
Borrower intent data
The signal that a specific company is likely to seek debt financing soon. How it differs from horizontal B2B intent (Bombora, 6sense), and what triggers count.
Working capital
Current assets minus current liabilities. The single number that drives most UK SME short-term borrowing demand — and every alt-lender underwriter's first look.
Invoice finance
Turn unpaid customer invoices into cash within 24 hours. The dominant UK working-capital product for B2B SMEs — factoring vs invoice discounting explained.
Factor rate
The pricing convention used by merchant cash advances and revenue-based loans. Not an APR — and consistently misunderstood by both borrowers and headline comparisons.
PECR
Privacy and Electronic Communications Regulations. The UK rules every lender BDR team must know before sending a single cold email or picking up the dialler.
ICP
The precise definition of the company you actually want as a customer. The single document that decides whether a lead is fit-or-skip in 5 seconds.
Data residency
Where your data physically lives. A procurement question that often decides whether a UK lender can sign a vendor at all.
UK SME definition
What officially counts as a UK SME — micro, small, medium — and why the definition matters for lender Consumer-Duty scope.
Working capital loan
Short-term borrowing to fund day-to-day operations. The dominant unsecured product UK SMEs take when cashflow stretches further than the bank account.
KYC / AML
Know Your Customer + Anti-Money Laundering. The compliance backbone every UK alt-lender runs before disbursing a loan — Companies House, identity, sanctions, open banking.
Open Banking
The regulated UK framework for pulling bank-statement data into underwriting. Faster than PDF uploads, harder to falsify — tight limits for thin-credit-file SMEs.
EBITDA
UK lenders' most-used cashflow proxy — both for sizing facilities and for getting the answer wrong on growing SMEs. Two formulas, five well-known limits.
Asset finance
Borrowing secured against a specific vehicle, machine, or piece of equipment. Cheapest UK SME credit because the lender has real collateral. HP, lease, or refinance.
Embedded finance
Lending delivered inside someone else's software (Shopify Capital, Tide, Stripe Capital). Biggest UK alt-lender distribution channel of the last 5 years.
Sole trader vs Ltd
Two legal forms; very different lender treatment. The single biggest reason a UK lender's decline letter says "we can only lend to limited companies".