What is Healthcare Finance?
Whether you’re setting up a new business in the healthcare sector or growing an existing one, you’ll find plenty of finance solutions designed to make your life easier. Independently owned hospitals and GP surgeries, dental practices, specialist clinics, opticians and pharmacies, care services, and veterinary surgeries can all benefit from healthcare financing
How Does Healthcare Finance Work?
Here’s a quick overview:
Depending on your needs, your business might benefit from one or more of the following healthcare financing options.
Business loans:
These can be secured or unsecured. Secured loans involve using an asset, such as medical equipment, as collateral to ensure that the loan will be paid back. If you do not repay the whole amount, the asset can be seized. Unsecured loans may require a personal guarantee, and interest will typically be higher.
Asset finance:
This is a way to buy or lease healthcare equipment without spending a large amount of cash upfront. You make monthly payments over a longer period, usually up to five years. These are fixed and include interest and VAT.
Refinancing:
This allows you to release equity that’s tied up in assets you already own. Effectively, you sell these assets to the lender in return for a sum of money, which you then repay in affordable monthly installments.
Acquisition finance:
Business loans specifically designed to allow you to expand your business by acquiring another clinic, surgery or service provider. Repayments are typically monthly – the period depends on the loan amount.
Tax loans:
Because cash flow isn’t always predictable, even the most careful and prepared business owner can require help with tax payments. Tax loans allow you to make tax and VAT payments if you don’t have the money available. You’ll make monthly repayments to the lender over the course of a year.
Who is eligible for healthcare finance?
Companies in the healthcare, veterinary and care sectors can obtain financing at all stages of their development. The amount of the loan, the interest rate, the repayment terms and the lender requirements can vary depending on your turnover and how long you’ve been in business. As a rule of thumb, smaller loans will have a shorter repayment period, while larger amounts are typically repaid over years.
When you apply, you’ll need to furnish evidence of your business’s finances. This usually includes accounts and income statements over a certain period as well as a balance sheet and cash flow forecast. New and growing businesses should provide a detailed business plan.
How can I use healthcare finance?
The wide range of options available means that you can find funding for more or less any aspect of your healthcare business, including:
Mergers and acquisitions
Buying and renting property
Converting, expanding or renovating premises
Staff and associated costs, such as legal and HR services
Leasing or acquiring high-value medical equipment
Buying PPE, stock and medicines
Working capital
Bridging gaps in cash flow
IT and technical infrastructure
Marketing
Specialist Healthcare Funding
Access tailored funding to support the growth, expansion or modernisation of your healthcare business.
Whether you operate a dental practice, medical clinic, care home or specialist healthcare facility, structured finance can help you invest in equipment, property or working capital while protecting cash flow.