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UK business borrowing doubles as personal guarantee loans exceed house prices
UK business borrowing has seen a significant surge, with the proportion of companies taking on new credit or loans doubling from 28% in 2025 to 56% in 2026, according to research by HSBC UK. Business leaders cited rising costs from inflation, utilities, and labor as primary drivers, with 82% prioritizing cost reduction and 79% focusing on liquidity.
Concurrently, the scale of debt secured by personal guarantees has reached levels that exceed typical property values. Analysis from Purbeck Insurance Services shows the mean personal guarantee-backed loan has risen to £317,000, surpassing the mean UK property price of £271,204. This trend places increased risk on business directors, as their family homes are frequently used as collateral for these loans.
While much of the borrowing is intended to manage ongoing operational costs and liquidity, there is also evidence of increased demand for investment. Firms are increasingly utilizing finance for productivity improvements through technology, such as AI, as well as for research, development, and market expansion.
Entities
HM Land Registry · HSBC UK · Purbeck Insurance Services · United Kingdom
Claims
What the coverage asserts, and how many sources carry each claim.
- [○ 1 SOURCE] The mean value of a personal guarantee-backed loan in the UK is £317,000. www.abcmoney.co.uk
- [○ 1 SOURCE] The mean UK property price was recorded at £271,204. www.abcmoney.co.uk
- [● 2 SOURCES] The proportion of UK businesses taking on new borrowing or credit arrangements doubled from 28% in 2025 to 56% in 2026. www.independent.co.uk · www.standard.co.uk
- [○ 1 SOURCE] The median personal guarantee-backed loan is £190,000. www.abcmoney.co.uk
- [● 2 SOURCES] 82% of businesses identified cost reduction as a strategic priority, while 79% prioritized cashflow and liquidity. www.independent.co.uk · www.standard.co.uk