If you take out a loan, you might have to sign a debenture. The term 'debenture' refers to a secured loan agreement between a lender and you, the borrowing business, and it is registered at Companies House. It gives the lender security over the borrower’s assets - and so if a repayment is missed or there is an event of default, the lender can take ownership of the assets and sell them off.

A fixed charge is normally taken out against a tangible asset such as property. If there is a payment default by the borrower, the lender can take ownership of the asset and sell it off. The borrower also can not sell the asset without the lender’s consent.