A new analysis of over 50,000 UK companies by Swoop Funding reveals that female-founded businesses carry just £769 million in debt, compared to £9.5 billion for male-led firms. Even after adjusting for business numbers, the average female-led company debt stands at £91,755, versus £315,246 for male-led counterparts—more than three times the amount.
Debt Disparity Highlights Growth Barrier
Although 19.1% of UK businesses are led by women (nearly 1 million enterprises), they borrow far less than men, potentially limiting their ability to invest and expand. If female entrepreneurs matched the average debt levels of male-led firms, the report suggests, the UK could unlock tens of billions in additional economic value.
Why Women Borrow Less
Swoop Funding’s CEO Andrea Reynolds points to cultural attitudes and education gaps around business credit:
“Another way to look at these figures is that female-founded businesses are more often bootstrapped than male-founded businesses. The perception may be that by borrowing, business owners are playing with other people’s money.
Culturally, women may be put off from using debt to fund essential purchases in their business, so there is clearly still some work we could be doing to educate female entrepreneurs at every stage of their journey that responsible, planned debt is an established route to faster growth.”
Entrepreneurs Share Their Experiences
Goho Agency’s Bounce Back Loan
“We don’t have company credit cards or anything like that. The only bit of ‘debt’ I’ve ever taken on as a business is the Government’s Bounce Back loan. I took out a £25k Bounce Back loan which I have almost paid off now, only one of those people still work for me, but it was the right thing to do. Many other bosses would’ve just ended everyone’s contracts. I’m an empath and am far too emotional and care about people too much to get rich.”
— Stacey-Rebekka Karlsson, Founder, Goho Agency
Karlsson says that loan not only saved jobs but also strengthened the company’s service offering, leading to year-on-year growth.
Strategic Cash-Flow Management at KidsVip
“One of the most critical steps we took was establishing a comprehensive financial plan from day one. Cash-flow management through detailed budgeting was the next step… For example, the decision to enter a larger warehouse in Woodbridge was subject to detailed cost/benefit analysis to ensure that said expansion would be financially feasible without too much stress on our resources.
The other reason has been the strong rapport with suppliers and partners that has allowed us to negotiate flexible payment terms… We focus on allocating money to areas such as product development, marketing, and customer experience that earn it back in spades: Every pound counts toward long-term growth.”
— Victoria Shnaider, COO & Sales Director, KidsVip
Shnaider attributes their debt-free model to strict planning, supplier relationships, and targeted reinvestment.
Top Tips for Using Debt to Scale
Andrea Reynolds offers guidance for entrepreneurs ready to leverage borrowing responsibly:
- View debt as an investment in growth, not a burden.
- Explore non-bank lenders via platforms like Swoop for more flexible options.
- Use targeted funding products (e.g., VAT finance) to manage cash-flow spikes.
- Consolidate small debts under a commercial mortgage for simpler repayments.
- Maintain good credit to access better rates and larger facilities.
For the full report and data insights, visit swoopfunding.com/uk/business-debt-report/.
