Best small business loans of 2020

Not all business loans are created equal. Find the best lender for your specific financing needs.

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Getting a loan for your business today is a lot different than it was 10 years ago. Access to multiple new options means finding a lender you can trust takes a bit more effort. To save you time, we’ve narrowed down top picks for small business loans by lender category and type of financing.

Our top business loan picks for 2020

ondeck logo

Quick term loans and lines of credit that consider your whole financial history, not just your credit score.

loanbuilder logo

Working capital financing with the speed of a short-term loan and the personal touch of a bank. Award-winning customer service.

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Kabbage logo

Easy-to-use lines of credit with minimal fees and fast funding. Convenient, ongoing access to funds.

Our methodology: How we picked the best business loans

To find the best business loans, we first confirmed each lender’s legitimacy by looking at accreditations from industry organizations and the Better Business Bureau (BBB). We also looked at the lender’s business practices, website security and customer reviews from the BBB and Trustpilot.

We then analyzed each business product by asking ourselves:

  • Which lender is the most affordable for this particular need?
  • Which has the quickest funding speed?
  • Which has the widest range of lending limits?
  • Which offers the simplest application process?

We paid special attention to lenders that offered loans of $100,000 or less, since more than half of small business loans are made out in that amount, according to a study by the Federal Reserve.

Online direct lenders have become increasingly popular among businesses in recent years — especially as banks tighten eligibility requirements. These lenders can sometimes provide funding in as little as 24 hours and don’t have nearly as tough qualification criteria.

Here are two of our favorite online direct lenders:


OnDeck offers short- and long-term business term loans and lines of credit between $5,000 and $500,000 with a turnaround time that could be less than one day. It’s easy to apply, requires minimal paperwork and garners excellent customer reviews.

Your business must be at least one year old and make $100,000 or more annually to qualify. Business owners also must have a credit score of 500 or higher. Term loans come with annual interest rates (AIR) starting at 9.99% and lines of credit with APRs starting at 13.99%. Loan terms range from 3 to 36 months .

Borrowers repay OnDeck loans with automatic daily or weekly “micropayments” intended to minimally affect your business finances.

  • Who it’s best for: Business owners that have been around for a few years and need fast funding. The ideal candidate also has the capacity to repay their loan quickly.
  • Who should keep looking: Startups will have trouble qualifying, and older businesses stand to get better rates with other lenders.


Fundation provides business term loans and lines of credit between $20,000 and $500,000. It’s as fast as any online lender but has a uniquely personalized underwriting process that gives applicants the chance make a case for their business.

Qualifying businesses have been around for at least one year, include three or more employees, and generate at least $100,000 annually. Qualifying business owners have a personal credit score of at least 600. Expect an APR of 7.99% and term lengths between 1 year and 4 years. All business loans are secured with a lien on business assets.

  • Who it’s best for: Business owners who need working capital but have a spotty financial record that could benefit from some explaining.
  • Who should keep looking: Business owners paying for one-time expenses, businesses with fewer than three employees and young startups. Fundation loans are also not available to residents of North Dakota, South Dakota or Nevada.
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Peer-to-peer lenders are similar to online lenders, except they don’t provide the funding themselves. Instead, they connect you to investors through their online platform.

These are our top two picks for peer-to-peer lenders:


With the help of a LendingClub client advisor, business owners can borrow from $5,000 to $500,000 with low origination fees and no prepayment penalties — meaning you could potentially pay off your loan early to save on unnecessary interest. It typically takes only a few days to get your funds.

To qualify, your business must be at least two years old and make $75,000 in sales. Business owners must own at least 20% of the business, have a fair personal credit score or better and no recent bankruptcies or tax liens. APRs start at 4.99%, and borrowers can take between one and five years to repay their loans.

  • Who it’s best for: Businesses that have been around the block once or twice and want to borrow less than $100,000 to cover a one-time expense. Loans of $100,000 or more must be secured with a lien on business assets.
  • Who should keep looking: Startups and businesses that need continuous financing for daily expenses. It’s also not yet available to residents of Iowa and West Virginia.

Funding Circle

Excellent customer service and an easy-to-use website make this peer-to-peer pioneer shine. Qualifying business owners can borrow term loans of $25,000 to $500,000 and get your funds you apply. It’s available nationwide as well as in the UK, Germany and the Netherlands.

Who qualifies? Businesses that are at least two years old and part of an approved industry. Owners must have no criminal or bankruptcy history and a credit score of at least 660. And if you’ve got a tax lien of $5,000, Funding Circle wants to see your plan to pay it off. APRs are competitive, starting at 4.99%. You can pay off your loan over 6 months to 5 years .

  • Who it’s best for: Extra-small businesses looking to borrow more than just a couple thousand dollars and struggling with meeting revenue requirements.
  • Who should keep looking: New businesses or those that only need a modest amount of funding. Check to make sure your industry qualifies before applying.
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Bank loans are the Holy Grail of business lending: Everyone seems to want one, but most business owners can’t seem to find one. These are our picks for bank business loans:


Bank loans are known for taking extra time and effort compared with other options, but that isn’t always the case — especially if you’re already a customer. Chase cardholders can have funds of $5,000 or more immediately deposited into their accounts as soon as they’re approved.

There’s no online application, but that’s part of the appeal. Instead, you have to walk down to your local Chase branch and meet with a loan officer, where you discuss your finances and present your business plan.

Having a Chase business checking account and a business plan are the only hard eligibility requirements. Chase determines your rates, loan amounts and terms based on your personal and business financial history, as well as projections. You might have trouble getting approved if your credit is less than stellar. Or you could end up with high rates.

  • Who it’s best for: Small business owners with good credit and a Chase business checking account. Also for people who feel safer with a big-name bank.
  • Who should keep looking: Business owners that don’t have a Chase account or applicants with poor credit.

Celtic Bank

Celtic Bank is one of the top Small Business Administration (SBA) lenders in the country, offering highly competitive rates. But not every business can qualify: On top of Celtic Bank’s eligibility requirements, the SBA also has a detailed a list of its own requirements to get approved for an SBA loan.

Celtic Bank provides funding for almost any business need, from buying equipment to refinancing debt to covering overhead costs in the offseason. You can borrow anywhere from $20,000 to $10 million, depending on your loan type, and all require some kind of collateral — which can translate into even lower interest rates. And you can take up to 25 years to pay it back.

  • Who it’s best for: Businesses that need a lot of funds to cover large overhead costs or purchase lots of equipment — like manufacturers, farmers or businesses in construction.
  • Who should keep looking: Small businesses in industries that don’t require much equipment or need less than $20,000 in funds.

Our top five picks for small business bank loans

Should I get a bank loan?

Banks seem like an obvious place to go for a loan, especially if you’ve been borrowing for a long time. But bank business loans aren’t always what they’re cracked up to be. They can take more time and sometimes require interviews or even site visits.

After all that, only about 20% of business owners who apply for a bank loan get accepted. Online lenders might come with higher interest and fees but they also have higher acceptance rates and faster turnaround times.

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Online marketplaces are sometimes confused with peer-to-peer lenders, but they’re not quite the same. Rather than matching you with investors, online marketplaces match you with lenders.

It’s an easy way to see a wide selection of lenders, but you’re typically limited to the marketplace’s partners. Here are our top choices for best online marketplace:


Business owners in the US and Canada can apply to get connected with lenders offering loans of as little as $500 and as much as $5,000,000 without charge. It offers 12 types of financing, including startup loans, accounts receivable financing and SBA loans, picking up the ball where many lenders drop off. And you can get your funds in Up to 1 business day .

US and Canadian business owners at least 18 years old with a business bank account and a credit score of at least 560 qualify. Expect to pay at least 6% in interest with loan terms of 1 to 25 years .

  • Who it’s best for: Startups and businesses needing less common financing that don’t have the resources to invest in looking for a lender.
  • Who should keep looking: Business owners that have the resources to compare lenders themselves or don’t want their personal information given to a large group of unknown lenders.


Biz2Cred goes the extra mile when it comes to guiding you through the loan application process: Its loan specialists are available to answer questions to help you make the best decision. It also prescreens its lenders, so you know you’re not being paired off with some irreputable lender in exchange for a lead.

Through Biz2Credit, you can borrow anywhere from $5,000 to $5,000,000 for a wide range of financing. Rates and eligibility requirements vary by lender, though you typically need good credit to get the most competitive deals. Startups and even entrepreneurs might be able to find financing through Biz2Cred. Customer are highly satisfied: It’s one of the only companies with that elusive 10 out of 10 rating on Trustpilot.

  • Who it’s best for: Startups, entrepreneurs or other business owners that have never taken out a loan before and need help.
  • Who should keep looking: Business owners not interested in hand-holding who know what they’re looking for.

5 tips to get the best business loan

Increase your chances of approval and get the best rates and terms with these tips.

  1. Check your credit report. It’s good to know your personal credit score to figure out which lenders you qualify for. Beyond that, your credit report might contain mistakes. Get these straightened out before you apply for a loan to qualify for the rates you deserve. If your business is more established, you may have a business credit score that lenders consider as well.
  2. Over-prepare. Know your business’s finances backward and forward. Get all of your documentation together ahead of time and have it on hand. Remember, you want to appear the most qualified.
  3. Have a business plan that tells your story. Even if your lender doesn’t require it, a solid business plan means you’re on top of your business’s finances and future projections. Business plans make it easier to understand the types of financing you need, how much and what you might qualify for.
  4. Go for big lenders for big loans. Big banks are less likely to approve borrowers who need small amounts of financing. Its best to save banks and other big lenders for larger projects like real estate or buying large amounts of equipment.
  5. Take advantage of risk-free prequalification. The best way to get an idea of what rates you might qualify for is by prequalifying or calling your lender. It’s not guaranteed that you’ll get those rates, but it’s a smaller ballpark than the advertised APR and term range. And you can more accurately weed out lenders that won’t accept you in the first place.
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Know what type of financing you need?
Our top picks by loan type

Best for startups loans: National Business Capital

Businesses as young as six months old can borrow up to $5,000,000 as long as they have an annual revenue of at least $180,000. Startup financing is also available for borrowers with excellent personal credit scores.

Best for bad credit loans: OnDeck

Business owners can qualify for an OnDeck loan with a credit score of 500 or higher. OnDeck takes other aspects of your financial history into consideration when determining your interest and fees — so your credit may not affect your rate as much as with other lenders.

Best for lines of credit: Kabbage

Small businesses in business at least one year can be approved for lines of credit between $500 and $250,000 in a matter of minutes. You can easily access funds through its website, its app or by swiping your Kabbage card — kind of like a credit card.

Best for merchant cash advances: RapidAdvance

RapidAdvance doesn’t scrimp on anything: speed, ease of application or customer service. Applicants of all credit scores can get an advance on future transactions worth up to $50,000.

Best for working capital loans: SnapCap

This lender specializing in working capital loans offers flexible repayment terms and lower interest rates for repeat borrowers. And it doesn’t just consider your credit score when you apply. It’s got a wide range of loan amounts — from $5,000 to $600,000.

Best for equipment financing: Currency Capital

Industry heavyweights like eBay and Caterpillar use Currency Capital equipment loans, but they’re not just for business titans. While it’s best for large equipment purchases, small businesses can qualify too. And interest rates are competitive to boot, ranging from 6%.

Best for franchise financing: ApplePie Capital

ApplePie Capital is one of the few business lenders that specializes in franchise financing specifically. It’s a direct lender that also works with a network of banks to make sure your franchise can get the right type of financing for its needs. Plus rates are highly competitive for a business loan, running from 6.5% to 9% .

Best for SBA loans: SmartBiz

SmartBiz cuts the months-long process of applying for an SBA loan into weeks. Its loans come with the same benefits of any other government-backed loan: Competitive interest rates and loan terms stretching up to 25 years.

Best for microloans: Accion

This global lender offers small loans designed to fit the needs of your industry in your community. It’s also a nonprofit lender, meaning that your interest — rather than its bottom line — is the priority.

Best for invoice financing: Fundbox

This easy-to-use service allows you to get fast advances on your invoices at any time with just a few clicks. After you receive your funds, you repay that amount plus a fee that starts at 4.66%.

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A few more business lenders worth mentioning

Lender What it offers Requirements
BlueVine Lines of credit and invoice factoring Lines of credit: 6+ months in business, $100,000+ annual revenue, 600+ credit score, not based in North Dakota or South Dakota

Invoice factoring: 530+ personal credit score, 3+ months in business, $100,000+ annual revenue Not available to healthcare or medical industries.

Excel Capital Management Split funding, term loans, equipment financing, invoice factoring, SBA loans, business lines of credit, startup loans, truck financing, loan consolidation Your business must operate in the US, be at least 1 year old and have monthly revenue of $15,000+.

Different loans come with more specific requirements.

Go to Excel Capital Management, Inc.'s site
Credibility Capital Short-term business loans, SBA loans, equipment financing, business lines of credit, invoice financing Business is at least 18 months old, strong personal credit, no personal or commercial bankruptcies in past five years, US citizen.

Not available in NV, ND, SD or VT.

Top types of loans for small businesses

Click on one of the following loans to find out which type of financing works best for your small business.

Find out how other business loan types work

What do lenders look for in a business?

Finding a competitive deal on a business loan doesn’t just depend on finding a lender that offers low rates and the right type of financing. No matter where you apply, your business is more likely to qualify for competitive terms if you and your business meet the following criteria.

  • Your business is at least one year old. Lenders like to see that your business has a track record of steady revenue coming in to reassure them that you can afford to pay off your loan.
  • You have strong personal credit. While business credit scores do sometimes come into play, your personal credit score typically plays a more important role in your loan application.
  • You’re personally invested. Some lenders require that owners invest a certain amount of their personal funds in the business. Even if it doesn’t, a personal investment is a vote of confidence that many lenders take into account.
  • You’re willing to put up collateral. Many small business lenders require business owners to put a lien on their personal assets up as collateral. Securing your loan takes some of the risk off of the lender and can help you qualify for more competitive rates.

Business financing alternatives

Sometimes a business loan isn’t the best way to fund your business. If you’re new, have low revenue or poor credit, you might not be able to get the most competitive rate. Instead, you might want to consider one of the following options:

  • Personal loans. A personal loan is a popular choice for entrepreneurs trying to fund a startup. They typically max out at $100,000 and often require good credit, so they’re not right for all business owners and needs.
  • Crowdfunding. You might not need to take on debt or pay anyone back at all if your business needs to fund a project that’s easy to communicate in a short video. Crowdfunding can help you raise the money from your fans or investors.
  • Equity investments. Get funding for your business that you never have to pay back in exchange for partial ownership in your company by brining on an investor.
  • Business credit cards. For small expenses or working capital, a business credit card is sometimes a lot easier to manage than a loan. Plus, many business credit cards come with 0% APR promotional periods, giving you a window to make a big purchase and pay it off without interest over a few months or a year.
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Bottom line

There is no one best business loan for everyone. But there are better lenders for specific business needs.

Understanding the type of loan you need is the first step toward getting a business loan that fits. Use our site to learn more about business financing and find lenders you and your business qualify for.

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