No. Debt can still be an important tool for growth, helping businesses invest, expand, modernise, or manage working capital. Higher rates have not made debt irrelevant; they have made discipline more important. The key is whether debt is being used with a clear financial plan rather than to cover avoidable financial weakness.
Because the relevant question is no longer simply whether a business can afford a loan today, but whether it could still afford it if revenue drops, clients pay late, costs increase, or refinancing becomes more expensive. Forecasting and scenario planning reveal whether finance costs would remain sustainable under less favourable conditions.
Existing facilities may also become more expensive if they are linked to variable rates or need to be refinanced. A loan that looked affordable two or three years ago can place more pressure on cash flow today if repayment costs increase or revenue does not grow as expected.
Lenders are likely to pay close attention to repayment capacity, cash flow quality, financial statements, debtor balances, tax compliance, and the strength of management accounts. A business seeking finance needs to show numbers that support the story, not just ambition; weak or outdated reporting can make funding harder.
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