Finder makes money from featured partners, but editorial opinions are our own. Advertiser disclosure

Best small business loans of January 2024

Compare legit business loans with rates starting as low as 3% APR.

A business loan can help you purchase inventory, free up cash flow or even open a site or storefront. As of the second quarter of 2023, the average fixed rate for a business term loan sat at 7.31% – although rates on business loans can range anywhere from 3% to 60% and up.

The Federal Reserve funds rate is sitting at 5.33% as of January 23, 2024 – the same as last month. But it’s one point higher than a year ago, which means borrowing is still relatively expensive as we head into 2024. Term loans from banks tend to have the lowest rates, while short-term loans from online lenders have some of the highest rates.

Regardless of the type of loan or financing you’re after, the best lenders offer competitive rates, low fees and fast approval and funding.


Go to site

  • Required time in business: 1+ years
  • Required annual revenue: $50k+
  • Min credit score: 525+

Best for small businesses

Go to site

  • Required time in business: 6 months
  • Required monthly revenue: $20k
  • Min credit score: 550

Good for online businesses

Go to site

  • Required time in business: 6+ months
  • Required annual revenue: $60,000+
  • Min credit score: 550+

10 best small business loans

Best small business loan marketplace

Lendio business loans


Finder score

Go to site Read review
Lendio can be a good place to start if you want to save time searching for a lender. Just complete an online form with your information to compare potential lenders that offer a wide range of short- and long-term loans, including term and SBA loans, lines of credit and merchant cash advances. Lendio's network includes more than 75 lenders that cater to a range of credit scores. For credit lines, you might even qualify with a credit score around 500. But you may receive marketing calls and emails from lenders, even after you take out a loan.

Best line of credit

Bluevine business lines of credit


Finder score

Read review
BlueVine offers lines of credit up to $250,000 and with its low starting APR and lack of fees – it could be a good choice for small businesses that need frequent access to funds. After you're approved, you can pay a $15 wire transfer fee to accelerate your funds in a few hours. Otherwise, withdrawals take one to three business days to process. Its lines of credit are revolving, so you can borrow and repay as needed. But repayments are weekly if you go with the line of credit — which may strain your budget during slow seasonal periods.

Best microloan

Kiva business loans


Finder score

Go to site
on's secure site
Kiva's interest-free microloans are ideal for entrepreneurs looking to turn an idea into reality. It doesn't have any time-in-business requirements, and you can borrow up to $15,000 without paying interest or fees. Borrowers are also granted a six-month grace period before payments are due. But know that Kiva is a nonprofit crowdfunding platform — so if you don't have a large social network willing to contribute, you may not get anything. Loans that aren't fully funded aren't dispersed.

Best for fast funding

OnDeck short-term loans


Finder score

Read review
OnDeck offers short-term loans to businesses looking for quick funding and who might not qualify for a bank loan. Its line of credit requires very little documentation to apply and funding could be as soon as the same business day. Requirements are in line with other providers, requiring one year in business and $100,000 in annual revenue. And it may accept credit scores as a low 625, so borrowers with fair credit have a shot. There are no prepayment penalties or draw fees on the line of credit (LOC), but repayments may be weekly.

Best merchant cash advance

Credibly business financing


Finder score

Read review
With factor rates starting at 1.11, Credibly is among the least expensive merchant cash advances out there. It's also more transparent about its rates and fees than similar providers, and you can access your funds as soon as the day you're approved. While its $15,000 monthly minimum revenue requirement is higher than other competitors like Fora Financial, it's not restricted to credit card sales. But like other merchant cash advances, it's still an expensive product.

Best bank loan

Bank of America business loans


Finder score

Bank of America offers a wide range of secured and unsecured loans and lines of credit for most business needs. It even offers business auto loans — which can be hard to find at large banks. This nationwide lender has some of the lowest starting rates for unsecured financing and generous relationship discounts. But, as with most big banks, it can be difficult to qualify – especially if you aren't already a customer. Smaller businesses might have more luck with a community bank or online lender.

Best for high-risk industries

United Capital Source business term loans


Finder score

Read review
If you own a newer business, work in a high-risk industry or have poor credit, United Capital Source could be a helpful stop. It's an alternative business loan connection service that helps borrowers who struggle to qualify for traditional lending options. Search for a business line of credit, merchant cash advance, SBA loan or invoice and receivables factoring. It's cannabis-business friendly, accepts bad credit borrowers and customers give it generally high reviews. You could even qualify if you've been in business for just a few months.

Best equipment financing

National Funding business loans


Finder score

National Funding offers customized loans directly and with its lending partners. It offers equipment financing and leasing of up to $150,000 for new or used equipment. It guarantees you won't find a lower monthly payment elsewhere, or it pays $1,000 toward the equipment lease. And there's no down payment requirement. National Funding advertises fast approvals and funding in as soon as 24 hours, with early payment discounts and excellent customer reviews.

Best for startups

Finance Factory business loans


Finder score

Finance Factory is an online lender marketplace with multiple financing options for startups. Entrepreneurs can also find services to roll over a retirement account into a new venture and personal loans to fund a new business. While it's not a direct lender, it's uniquely transparent about terms and rates — which are lower than average. But some financing options may require good to excellent credit, and funding can take a few weeks.

Best for SBA loans

SmartBiz business loans


Finder score

SmartBiz speeds up the SBA application process by streamlining the information you need to provide. By working with multiple banks and online lenders, it may take just a few weeks to get funding — rather than the normal multimonth waiting period. Prequalification takes a few minutes, and the rates its lenders offer start low. But you'll need to borrow at least $30,000, and the process isn't free: SmartBiz charges a 2% referral fee and 2% packaging fee if you're approved.

Methodology: How we choose the best business loans

Our lending experts analyze dozens of business loan providers to determine the best for business owners and startups. We search for lenders that suit a range of lending needs, highly-rated lenders that offer loans of $100,000 or less because most small business loans fall into that range.

We weigh lenders against 12 key metrics:

  • Rates
  • Fees
  • Application process
  • Lender reputation
  • Eligibility requirements
  • Credit score minimums
  • Products offered
  • Willingness to work with risky industries
  • Minimum and maximum loan amounts
  • Customer service reviews
  • Funding turnaround times
  • Extra features

How small business loans work

A business loan is a form of financing designed to help you start, grow or operate your small business, offering access to capital to cover payroll, purchase real estate, invest in equipment or other business needs.

Business loans can be unsecured or secured, which means collateral backs the loan. Even lenders advertising unsecured business loans may require a lien on business assets. You may also be asked for a personal guarantee, which means you’re responsible for the loan if the business fails.

You can find business loans through traditional banks and credit unions, online lenders and marketplaces, and community lenders. While a conventional business loan is a lump sum you repay in monthly installments, plus interest and fees – there are other types of financing that work differently but are still referred to as loans by lenders.

Interest rates vary widely by business loan type, ranging from 3% to 300% APR. Loans secured by collateral like invoices, equipment or real estate tend to have the lowest rates, while short-term financing options like merchant cash advances tend to have the highest rates.

Types of small business loans

Term loans and lines of credit may be the most popular types of financing. But other options might be better for certain businesses — especially those that struggle to qualify for traditional bank financing.

Loan typeTypical loan amountsBest for
SBA loan$30,000 to $5 millionSmall businesses that have trouble qualifying for a low-interest loan.
Term loanUp to $2 millionCovering one-time expenses, like buying office supplies or technology or other costs that your business doesn’t need to cover regularly.
Business line of credit$2,000 and $250,000Covering recurring expenses tied to your business’s cash cycle, picking up the slack during an off-season or paying for ongoing projects where costs are difficult to predict.
Equipment financingUp to 100% of the equipment’s valueBusinesses buy heavy machinery and other expensive equipment.
MicroloanStart as low as $500Small businesses that need financing for basic necessities but can’t qualify for a traditional business loan.

What are the benefits of a small business loan?

There are several benefits to using a small business loan or another type of financing:

  • Keep control of your business after receiving funds
  • Get funds to expand operations and meet demand
  • Cover operating expenses during a slow season
  • Deduct interest on your business tax returns

How to get the best small business loan

Watch our 60 second video below!

While small business loan requirements depend on the financing you need, you’ll get the lowest rates and strongest terms by meeting general requirements that include:

  • Good credit. If you don’t have a score of at least 670, consider bringing a cosigner along for better approval odds.
  • At least $50,000 in revenue. If your business is new or still in the startup phase, look into our top editorial picks for startup business loans.
  • At least one year in business. One year in business is pretty standard for most business loans. However, startup loans and other types of financing may only require six months or less in business.
  • A low-risk industry. High-risk industries like adult entertainment, cannabis and gambling may struggle to find financing.
  • Collateral requirements. If you’re looking for a secured business loan, know what collateral you’ll use to secure it. For example, with equipment financing, the loan is secured by the asset you’re financing.
  • Personal and business documentation. When applying, lenders ask for tax returns, profit and loss statements and more. Know what you’ll need to have on hand ahead of time.

Don’t meet these requirements? Visit our guide to business loans to learn more about your options. You can also set up an appointment at a local bank. Community banks tend to have more flexible requirements than their larger counterparts. Even if you don’t qualify for financing, the bank can point you toward other options and advise you on strengthening your application. Or, consider a personal loan from a lender like Upstart if you need funding fast.

Business loan documentation checklist

Prepare to submit personal and business documents when applying for a small business loan, including:

  • Business and personal tax returns for your business and all owners
  • Government-issued identification and Employer Identification Number (EIN)
  • Profit and loss statements and balance sheets for up to three years
  • Business and personal bank statements
  • Business plan and future projections
  • The credit score requirement is typically 670+

What is the largest business loan I can get?

How much of a loan you can qualify for depends on factors like your business’s revenue, debts and what you’re financing. Generally, your loan amount is based on the value of a self-liquidating asset you’re using the funds to purchase.

  • SBA loan — from $500 to $5,000,000, depending on the program
  • Lines of credit — highs of $250,000 to $500,000
  • Equipment financing — value typically equal to the equipment’s value

Business loan alternatives

If you own a newer business, haven’t yet reached $100,000 in revenue or have poor credit, you may not qualify for the lowest rates. Look to other financing options to grow your business.

Personal loans

A personal loan is a common choice for entrepreneurs looking to fund a startup. These loans typically max out at $50,000, though sometimes reach $100,000. The best personal loans require good credit, which is unsuitable for all business owners and needs.


You might not need to take on debt or pay anyone back if your business needs to fund a project that’s easy to communicate in a short video. Friends, fans or investors can help you raise money through crowdfunding. But keep up with regulations that are developing around it.

For example, all crowdfunding transactions must be online through a Securities and Exchange Commission (SEC)-registered intermediary. You can’t raise more than $5 million through crowdfunding offerings in a 12-month period, as stated by the US SEC.

Equity investments

You could finance your business needs by bringing on an investor. An investor allows you to get funding for your business that you never have to pay back in exchange for partial ownership in your company. But ensure you have a lawyer on retainer to avoid legal trouble with the SEC.

Business credit cards

For small expenses or working capital, a business credit card can be 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.

Invoice financing

This alternative type of financing is an advance on unpaid accounts receivables — also called accounts receivable financing. It’s an asset-based loan to help give your business cash flow while you wait for invoices to be paid. However, invoice financing is an advance that can be expensive.

Inventory financing

Got orders but not enough inventory? Inventory financing is a line of credit you use to purchase products, and the inventory is collateral on the loan. However, if you need to buy perishables like produce, you can find financing options for which the merchandise doesn’t secure the loan.

Merchant cash advance

An alternative borrowing option, a merchant cash advance, is a lump sum loan based on a percentage of your business’s card sales. It’s often for emergencies, used to cover expenses in a pinch or during slow seasons. Merchant cash advances don’t charge traditional interest. Instead, you get charged a fee called a factor rate expressed as a decimal — usually between 1.09 and 1.5 — and the factor gets multiplied by the amount borrowed.

This type of financing can get expensive, and many providers require weekly repayments.

Grants and other resources for small businesses

Whether you’re just starting or need help with crafting a business plan, check out these no- or low-cost resources:

  • Small Business Development Centers — SBDCs are the US’s network of small business development centers, all sharing the goal of helping small businesses grow. With over 1,000 local centers, SBDCs offer no-cost consulting to assist entrepreneurs in starting or expanding a business.
  • — Search for grants, training programs and financing options through this government site.
  • Federal grants for tech businesses — Tech-centered companies may be eligible for the Small Business Innovation Research (SBIR) or Business Technology Transfer (SBTT) program grant. Each grant is suited for tech businesses or those with scientific research.
  • Local grants — State and local governments often have small business centers with information about grants and other resources.

How to manage payments

Business owners may not be strangers to debt. But if you’re looking to take on your first business loan or you’re struggling to manage multiple credit lines, keep these tips in mind:

  • Autopay. Sign up for autopay to avoid missing payments. As a bonus, many lenders offer rate discounts if you enroll in autopay, often around 0.25%.
  • Keep your lender in the loop. Even when things are going great, stay in contact with your lender because they may offer new products and prefer lending to businesses with existing relationships.
  • Ask about hardship programs. Hard times can fall on anyone. If you can’t repay your loan, even temporarily, contact your lender and ask about a hardship program or deferment plan. Lenders often offer deferment options rather than have you default.
  • Only borrow when you need it. Don’t be tempted to take on a larger loan simply because it’s offered, and ensure the loans you take on will be beneficial.
  • Consider consolidating if you have multiple loans. If you have multiple loans or high interest rates, you could consolidate your business debt for a lower rate and more manageable payments — if your business is in a strong financial situation with good credit.

How business debt consolidation works

Debt consolidation works by paying off one or more loans with a new loan, usually to save on interest charges. Most business debt consolidation loans are term loans, but it’s also common to consolidate debt with a low-rate credit card, such as a balance transfer credit card. You can also consolidate business debt with a personal debt consolidation loan or home equity loan, though you’ll be responsible for repayment if the business fails.

Debt consolidation might be wise if you have good credit and high-interest debt. But if you have poor credit and your company isn’t profitable, your business isn’t likely to qualify for a low rate on the consolidation loan. Even if you do, it may not save you money in the long run.


Can I get a business loan with bad credit?

Yes, it’s possible to get a business loan with bad credit. Some lenders – especially online lenders – will accept scores as low as 500 on certain short-term loans, like merchant cash advances. And other financing options, like invoice financing or factoring, may not consider your credit score at all. As long as you can show sufficient revenue or invoice value, you could qualify. But rates can often run high on these types of bad credit business loans and are best used in a cash crunch.

What is the largest business loan I can get?

How much of a loan you can qualify for depends on factors like your business’s revenue, debts and what you’re financing. Generally, your loan amount is based on the value of a self-liquidating asset you’re using the funds to purchase.

  • SBA loan — from $500 to $5,000,000, depending on the program
  • Lines of credit — highs of $250,000 to $500,000
  • Equipment financing — value typically equal to the equipment’s value

Can I get a business loan with self-employment income?

Many banks and credit unions offer loans to the self-employed, including business loans. But your odds might be better with an online lender. If you’ve exhausted these options, consider applying to the US Small Business Administration (SBA).

The following SBA loans are available to sole proprietors or independent contractors:

  • SBA microloan, which offers up to $50,000 in funding
  • SBA express loan, which offers up to $500,000 in funding
  • SBA 7(a) loan, which offers up to $5 million in funding

Different SBA loans come with varied eligibility requirements. To qualify for an SBA loan, you must typically have a 680 FICO score, operate your for-profit business in the US, and have exhausted all other funding options.

Can I get a business loan for my startup business?

Startup loans for brand new businesses with no track record are hard to come by. Most lenders want to see at least six months in business and a certain level of revenue. This presents a catch-22 if you haven’t earned anything yet.

Instead, you could look into getting a personal loan to fund a new business or borrow against your assets, like your home or 401(K) – but these options come with financial risks. If you’re more entrepreneurial, consider a microlender like Kiva, an angel investor or a crowdfunding campaign.

How does business debt consolidation work?

Debt consolidation works by paying off one or more loans with a new loan, usually to save on interest charges. Most business debt consolidation loans are term loans, but it’s also common to consolidate debt with a low-rate credit card. You can also consolidate business debt with a personal debt consolidation loan or home equity loan, though you’ll be responsible for repayment if the business fails.

Debt consolidation might be wise if you have good credit and high-interest debt. But if you have poor credit and your company isn’t profitable, your business isn’t likely to qualify for a low rate on the consolidation loan. Even if you do, it may not save you money in the long run.

Top 10 best business guides

Explore the top business loan guides to help you along your business journey. From information on the best business loans on the market or your best startup loan options, to business loans that require little to no paperwork and more.

More guides on Finder

Ask an Expert provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site