Lender | Best for | Max loan amount▼ | Min. credit score▼ | APR range | Max term length▼ |
---|---|---|---|---|---|
![]() | SBA loans | $5,000,000 | 650 | 11.50-15.00% | 25 years |
![]() 4.8/5.0 | Bank small-business loans | See review | 700 | See review | 5 years |
![]() 4.9/5.0 | Bank lines of credit | $150,000 | 680 | 10.25-18.25% | See review |
![]() 5.0/5.0 | Fast business loans | $250,000 | 625 | 20.00-50.00% | 6 months |
![]() 4.9/5.0 | Startup business loans | $150,000 | 600 | 36.00-99.00% | 6 months |
![]() 4.6/5.0 | Online lines of credit | $250,000 | 660 | See review | 2 years |
![]() 4.7/5.0 | Short-term business loans | $250,000 | 625 | 27.20-99.90% | 2 years |
![]() 4.5/5.0 | Long-term business loans | $500,000 | 660 | 15.22-45.00% | 7 years |
![]() 4.5/5.0 | Business loans for bad credit | $1,500,000 | 570 | See review | 1 year and 6 months |
![]() 4.4/5.0 | Invoice factoring | $10,000,000 | 300 | See review | See review |
![]() 4.2/5.0 | Equipment financing | $150,000 | 600 | See review | 5 years |
![]() 4.6/5.0 | Women and minority groups | $250,000 | 570 | 8.49-24.99% | 5 years |
Best for
SBA loans
SBA loans offer favorable rates and terms and can be used for a variety of large and long-term funding purposes. These government-guaranteed loans are best for businesses that don’t meet bank eligibility criteria, but still have good credit and strong finances.
» MORE: NerdWallet’s guide to SBA loans
SBA 7(a) loan
Max loan
$5,000,000
Min. Credit score
650
Apr range
11.50-15.00%
Best for
Bank small-business loans
Banks typically offer small-business loans with the lowest interest rates and most competitive terms. These products are well-suited for established businesses with collateral and strong credit.
Bank of America Business Advantage Unsecured Term Loan
Max loan
Undisclosed
Min. Credit score
700
Best for
Bank lines of credit
A bank line of credit offers greater flexibility than a business term loan — allowing you to tap into a credit line and pay interest on only the portion of money you borrow. Bank credit lines are a good source of affordable working capital for established businesses.
Wells Fargo BusinessLine® Line of Credit
Max loan
$150,000
Min. Credit score
680
Apr range
10.25-18.25%
Best for
Fast business loans
Online lenders typically offer simple applications and a streamlined underwriting process. Some companies can provide financing in as quickly as 24 hours — and most fund applications within a few business days.
Bluevine - Line of credit
Max loan
$250,000
Min. Credit score
625
Apr range
20.00-50.00%
Best for
Startup business loans
Some online lenders offer business loans for startups with one year or less in operation. You’ll typically need at least six months in business to qualify.
Fundbox - Line of credit
Max loan
$150,000
Min. Credit score
600
Apr range
36.00-99.00%
Best for
Online lines of credit
Online business lines of credit are best for fast access to working capital, especially for newer businesses or those with less-than-perfect credit histories.
American Express® Business Line of Credit
Max loan
$250,000
Min. Credit score
660
Best for
Short-term business loans
Short-term business loans can be good for businesses that can’t qualify for an SBA or bank loan, or those that need quick funding. Short-term lenders generally have less-stringent eligibility requirements compared to traditional lenders and may work with startups or businesses with bad credit.
» MORE: Best short-term business loans
OnDeck - Online term loan
Max loan
$250,000
Min. Credit score
625
Apr range
27.20-99.90%
Best for
Long-term business loans
Long-term loans can help you expand your business — and provide more time to repay and lower monthly payments than short-term loans. Some online lenders can offer repayment terms up to seven years, with faster funding times than more conventional business loan options.
» MORE: Best long-term business loans
Funding Circle - Online term loan
Max loan
$500,000
Min. Credit score
660
Apr range
15.22-45.00%
Best for
Business loans for bad credit
It can be more difficult to get a business loan with bad credit, but some online lenders are willing to work with borrowers who have a personal credit score below 630.
Fora Financial - Online term loan
Max loan
$1,500,000
Min. Credit score
570
Best for
Invoice factoring
Invoice factoring allows business-to-business companies to access capital that’s tied up in unpaid invoices. This type of fast funding can be useful for managing cash flow issues or paying short-term expenses.
AltLINE - Invoice Factoring
Max loan
$10,000,000
Min. Credit score
300
Best for
Equipment financing
Equipment financing is best for small businesses looking to purchase machinery or equipment. Since the equipment itself serves as collateral, equipment loans can be more affordable and easier to qualify for than other types of small-business loans.
National Funding - Equipment Financing
Max loan
$150,000
Min. Credit score
600
Best for
Women and minority groups
Nonprofit and community lenders often provide loans to traditionally underserved business owners who may not qualify for other funding options. These institutions also offer business training, coaching and other educational resources.
Accion Opportunity Fund - Small Business Working Capital Loan
Max loan
$250,000
Min. Credit score
570
Apr range
8.49-24.99%
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What is a business loan?
- Why you need funding.
- How fast you need access to capital.
- How much capital you need.
- Your business’s qualifications.
- Total cost of debt.
Types of small-business loans
SBA loans
- Loan amounts: $30,000 to $5 million.
- Approximate APR range:11.5% to15%.
- Best for: Large one-time and longer-term investments, purchasing real estate or equipment, buying existing businesses and refinancing debt.
Business term loans
- Loan amounts: Up to $1 million.
- Approximate APR range: 6% to 99%.
- Best for: Working capital, large one-time investments, expanding your business.
Business lines of credit
- Credit line range: $1,000 to $250,000.
- Approximate APR range: 10% to 99%.
- Best for: Managing cash flow, handling unexpected expenses and financing short-term business needs.
Compare financing and apply
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Equipment financing
- Loan amounts: Up to 100% of the value of the equipment, plus soft costs (e.g. installation, delivery, warranties).
- Approximate APR range: 4% to 45%.
- Best for: Purchasing machinery and equipment.
- Loan amounts: Up to $50,000.
- Approximate APR range: 8% to 30%.
- Best for: Smaller business investments, covering day-to-day expenses, working capital needs.
- Loan amounts: Up to 85% of the value of the property you own or are looking to buy.
- Approximate APR range: 4% to 15%.
- Best for: Purchasing and/or renovating commercial properties.
- Loan amounts: Up to 100% of the purchase price.
- Approximate APR range: 4% to 45%.
- Best for: Purchasing or refinancing cars, vans, trucks.
Government business loans
USDA business loans
SBA disaster loans
Additional business funding options
Invoice factoring and invoice financing
- Invoice factoring turns business owners’ unpaid invoices into immediate cash. You sell the invoices to a factoring company, which is paid when it collects from your customers.
- If you prefer to maintain control over your invoices, invoice financing is an alternative to factoring.
Personal loans
- A personal loan for business allows you to get funding based on your personal credit score and income instead of your business history.
- These loans are usually available in smaller amounts, but they can be used for a variety of purposes and fund within days.
Business credit cards
- A business credit card offers revolving credit, making it a solid option for short-term expenses.
- Although credit card limits tend to be smaller than a line of credit, a business credit card may offer rewards, such as cash back or travel points.
Merchant cash advances
- With a merchant cash advance (MCA), a financing company gives you an upfront sum of capital that you repay using a percentage of your debit and credit card sales, plus a fee.
- MCAs are typically fast to fund and easy to qualify for, but they’re one of the most expensive types of business funding, carrying APRs that can reach triple digitsbusiness financing options before turning to a merchant cash advance. . You should generally consider all other
- Small-business grants provide a free alternative to debt funding — offering access to capital that doesn’t need to be repaid.
- Business grants are available from a variety of sources, including federal, state and local governments, private companies and nonprofit organizations.
- A friend and family business loan is when you borrow money for your business from a close friend or family member.
- These loans are typically informal; they don’t require an application process or credit check. Creating a written loan agreement, however, can help preserve your personal relationship — just in case things don’t go as planned.
- Bootstrapping refers to entrepreneurs who use their own personal funds and resources (e.g. personal savings, credit cards) to start a business.
- Bootstrapping can be a good way to finance your business in its early stages, but you also risk losing your personal assets if your company isn’t successful.
- Crowdfunding allows you to use online platforms to raise money for your business. Supporters donate funds through your crowdfunding campaign, and in exchange, you usually offer rewards or equity in your company.
- Crowdfunding can be a good option for businesses with a strong customer base or large internet presence.
Small-business loans by interest rate
Minimum APR | Maximum APR | |
---|---|---|
Accion Opportunity Fund - Small Business Working Capital Loan | 8.49 %. | 24.99 %. |
AltLINE - Invoice Factoring | Discount rate of 0.80% per 30 days an invoice is factored. | Discount rate of 3.00% per 30 days an invoice is factored. |
Bank of America Business Advantage Unsecured Term Loan | 7.25%. | Undisclosed. |
Bluevine - Line of credit | 20 %. | 50 %. |
Fora Financial - Online term loan | Factor rate of 1.13. | Factor rate of 1.28. |
Fundbox - Line of credit | 36 %. | 99 %. |
Funding Circle - Online term loan | 15.22 %. | 45 %. |
National Funding - Equipment Financing | Factor rates start at 1.11. | Undisclosed. |
OnDeck - Online term loan | 27.2 %. | 99.9 %. |
SBA 7(a) loan | 11.5 %. | 15 %. |
Wells Fargo BusinessLine® Line of Credit | 10.25 %. | 18.25 %. |
- Build your credit score.
- Offer collateral.
- Pay down existing debt.
- Improve your cash flow.
- Shop and compare multiple financing options.
How do I qualify for a business loan?
![Some bills and a red card.](https://assets.nerdwallet.com/blog/wp-content/uploads/2024/02/card-payment-desktop.png)
![Sign with a "we are open" text.](https://assets.nerdwallet.com/blog/wp-content/uploads/2024/02/store-sign-desktop.png)
![Green circle with upward chart.](https://assets.nerdwallet.com/blog/wp-content/uploads/2024/03/upward-chart-spot.png)
- A promise of guaranteed approval.
- An upfront fee to apply for a loan.
- Aggressive sales tactics.
- A lender that won’t disclose interest rates and terms.
- Loan features that seem “too good to be true.”
How do I get a loan for my small business?
📋 Business loan application checklist
Small-business loans: Frequently asked questions
🏦 Curious about SBA loans?
Here’s an overview of how SBA loans work, the types of SBA loans that are available, what each loan type can be used for and how to get SBA financing for your small business.
How Fundera by NerdWallet works
Getting a business loan can be challenging, and several factors — cost, speed, repayment schedule — can play a role in deciding which product is right for you. Let us help you through the process.
1. Fill out one simple application
Answer a few questions about your business to get personalized lending options. It’s free and won’t impact your credit score.
2. See your business loan options
It takes about three minutes to get options from our network of vetted small-business lenders. Compare interest rates and repayment terms to choose the best product for your needs.
3. Get your loan
If the lender approves you, you’ll sign closing documents in order to receive funds. Some lenders can approve and fund loans within one business day.