Usually, yes. Lenders expect a stated purpose and most will restrict funds to legitimate business use. Some facilities are purpose-specific — a VAT loan is drawn to pay a VAT bill, for example — and the lender may pay the money directly to the relevant party. General working capital facilities are broader but still come with conditions in the agreement.
Common restrictions include prohibiting personal use, refinancing certain other debts, speculative investment, or anything outside your normal trading activity. Lenders may also require the funds to be used within a set period after drawdown.
Using funds outside the agreed purpose can put you in breach of the agreement, which may allow the lender to demand immediate repayment and will affect your future borrowing. If your plans change after you apply, tell the lender rather than assuming it will not matter.
Read the facility agreement before you sign, and ask about anything that is not clear. We can explain how a particular lender’s conditions work, but the agreement is between you and the lender.