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

Best low-interest business loans of June 2024

Rates depend on your creditworthiness and the type of loan you get — but marketplaces and alternative lenders may offer the best shot at low rates.

Whether you’re looking for a traditional bank loan, SBA loan or short-term funding to keep your business running smoothly – finding the best rate keeps your payments as low as possible while reducing the overall interest paid.

As of June 2024, banks are charging their best credit borrowers an average of 8.50% APR on term loans – but APRs across business loans can range from 3% to 60%+. Borrowers with high FICO scores and strong financials tend to get the lowest rates, but rates can vary wildly, so it pays to compare. Our June 2024 list of the best low-interest loans includes options for borrowers of all credit types and financing needs.

We chose these lenders based on their starting annual percentage rate (APR) – which is a more accurate representation of cost than interest.

9 best low-interest business loans

These nine lenders offer some of the lowest interest rates available compared to other similar types of financing.

LenderType of loanStarting APR
LendioBusiness loan marketplaceVaries by lender
Go to site
KivaMicroloan0%
Go to site
LendziBusiness loan marketplaceVaries by lender
Read review
BluevineLine of credit7.8%
Read review
Funding CirclePeer-to-peer loan7.49%
Read review
Live Oak BankSBA expansion loanVaries
Read review
SBG FundingWorking capital loanStarting at 1.75%
Accion Opportunity FundCDFI loan8.49%
Bank of AmericaUnsecured bank loan8.5%

Why trust Finder

  • 35+ business loan lenders reviewed and rated by our team of experts
  • 12+ types of business loans analyzed
  • Evaluated under our unbiased rating system covering 10+ categories
  • 20+ years of combined experience covering financial topics

We're big on editorial independence. That means our content, reviews and ratings are fair, accurate and trustworthy. We don't let advertisers or partners sway our opinions. Our financial experts put in the hard work, spending hours researching and analyzing hundreds of products based on data-driven methodologies to find the best accounts and providers for you. Explore our editorial guidelines to see how we work.

Best low-interest business loans

Read about how each of our best low-interest business loans works before you apply.

Best overall

Lendio business loans

4.8
★★★★★

Finder score

Go to site Read review
Loan amount$1,000 – $10,000,000
APRVaries by lender
Min. Credit Score520

Best microloan

Kiva business loans

3.7
★★★★★

Finder score

Go to site
on Businessloans.com's secure site
Loan amount$1,000 – $15,000
APR0%

Best loan marketplace

Lendzi

4.7
★★★★★

Finder score

Read review
Loan amount$5,000 – $20,000,000
APRVaries by lender
Min. Credit Score500

Best line of credit

Bluevine business lines of credit

4.3
★★★★★

Finder score

Read review
Loan amount$5,000 – $250,000
APRStarting at 7.8%
Min. Credit Score625

Best peer-to-peer loans

Funding Circle business loans

4.4
★★★★★

Finder score

Read review
Loan amount$25,000 – $500,000
APRstarting at 7.49%
Min. Credit Score660

Best SBA expansion loans

Live Oak Bank SBA loans

4.4
★★★★★

Finder score

Read review
Loan amountUp to $15 million
APRVaries

Best working capital loan

SBG Funding small business term loans

4.2
★★★★★

Finder score

Loan amount$5,000 – $10,000,000
APRStarting at 1.75%
Min. Credit Score600

Best CDFI loan

Accion Opportunity Fund business loans

3.6
★★★★★

Finder score

Loan amount$5,000 – $250,000
APR8.49% to 24.99%
Min. Credit Score570

Best unsecured bank loan

Bank of America business loans

3.6
★★★★★

Finder score

Loan amount$10,000 – $100,000
APRStarting at 8.50%
Min. Credit Score700

6 types of lenders that offer low-interest business loans

Under normal circumstances, banks, nonprofits and other providers that offer government-backed loans have the lowest interest rates on the market.

1. SBA lenders

SBA lenders offer government-guaranteed loans to established businesses that might not qualify for a bank loan. The SBA sets limits to interest and fees for all SBA loans that these lenders can charge, depending on the program and loan size.

Some SBA loans might even offer options to startups and business owners with bad credit, like the SBA Community Advantage and microloan programs. But generally, you need to have at least three years in business and good credit to qualify for most SBA loan programs.

2. Large national banks

Large national banks like Bank of America, Chase and Wells Fargo tend to offer the lowest interest rates out there on loans. However, national banks are highly risk-averse and offer some of the hardest loans to qualify for as a small business. Startups, business owners with credit scores below 670 and businesses in traditionally high-risk industries like construction may want to look into other options.

3. Regional and community banks

Regional banks like Citizens Bank and small community banks might offer slightly higher rates than most national banks — usually, they start at around 5% APR. But they’re generally cheaper than online lenders, are better suited to work with small businesses and offer more than just financing.

Community banks in particular are often intimately familiar with the local market and can offer personalized advice. And since these lenders are small, they can often be more flexible with credit requirements, such as the time in business or credit score minimum.

4. CDFIs

Community development financial institutions, or CDFIs, are small nonprofit lenders with a mission to support the economy in the community they serve. They often offer relatively low-cost loans to small businesses that can’t qualify for an SBA or bank loan. But they’re generally more expensive than a bank or SBA loan.

5. Microlenders

Microlenders are nonprofits that offer small-dollar financing to entrepreneurs and startups. While rates often top 12% APR, they’re cheap compared to the other options available to the borrowers they target. For example, interest rates on online loans available to startups and borrowers with bad credit typically top 60% APR.

6. Credit unions

While most credit unions don’t have business loan programs, those that do often have rates comparable to a regional or community bank. For example, Lake Michigan Credit Union’s business loan rates start at 5%. Requirements also often compare to regional or community bank loans — plus, you typically have to become a credit union member.

Consider a personal loan for low-cost startup financing

Personal loans may be a better choice if you have a startup with less than six months of revenue — as long as you have good credit and a source of income outside of your new company. That’s because lenders consider new businesses to be risky and will charge high rates — if they offer the loan at all. A personal loan from a lender like Upstart, which considers factors like your education and career alongside income and credit, may be a better option.

What is considered low interest on a business loan?

Any business loan with an annual interest rate (AIR) of 3% to 10% is considered low interest compared to the average interest rates you’d see with a business loan, depending on where you borrow from. However, it’s more common for lenders to display the APR on a loan – which is the rate with fees factored in – instead of AIR.

Since business loans typically come with origination fees of 1% to 5% of the loan amount, APRs of 6% to 15% APR are usually considered low. That’s because business loans can reach 100% APR or higher — especially with online short-term loans.

How to qualify for a low-interest business loan

You typically need to meet the following requirements to qualify for a low-interest business loan:

  • At least three years in business
  • Good or excellent credit score of at least 670
  • Profitable business with regular revenue
  • Low debt obligations compared to revenue
  • Low-risk industry

While requirements generally depend on the lender and type of loan, the lowest rates tend to go to these types of businesses.

Each lender has its own underwriting criteria. That’s why comparing offers from multiple providers can help you find the lowest interest rates available to you.

Is it possible to get a 0% interest business loan?

Getting 0% interest funding for your business is highly unlikely through any form of traditional business financing. However, there are less traditional forms of business funding that may offer a shot at 0% interest. For example, Kiva, which made our list, is a community-based lending platform that let’s you crowdsource funds from family, friends and a greater community of lenders. It’s websites says you can get up to $15,000 with 0% interest. You may also get funding from grants and other non-profits that offer funding with no interest.

More ways to compare business loans

While the interest rate is a large factor in your loan’s cost, it’s not the only thing you should compare. These factors can help you find financing that’s a good fit for your business.

  • Available loan amounts are key to comparing lenders. Look for a provider that offers the exact amount you need to avoid over-borrowing.
  • Loan terms tell you how long you have to pay off the loan and determine your monthly payment. A longer term gives you a lower payment but a higher total cost.
  • Monthly payments are how much you owe each month and will have an immediate effect on operations. Looking for a monthly payment you can afford is important to avoid defaulting on a loan.
  • Origination fees are a percentage of your loan that the lender either deducts or adds to the balance at closing. This can affect how much funding you receive and should factor into the amount you apply for.
  • Minimum requirements for credit score, revenue and time in business tell you where the lender isn’t willing to budge. For the best rates, look for a lender with requirements you comfortably meet.
  • Customer reviews on sites like Trustpilot and the Better Business Bureau tell you what you can expect from customer service and alert you to red flags to watch for.

Low-cost alternatives to business loans

Business loans aren’t always the right choice for every financing need. You may want to consider these alternatives before you apply.

  • Business grants offer funds that your business doesn’t have to repay, usually up to around $15,000. However, grants are mostly available to nonprofits and can be highly competitive.
  • Business credit cards offer revolving financing better suited for day-to-day expenses than a loan — like lunch orders and office supplies. And you won’t pay interest if you can pay the balance in full each month.
  • Personal loans can be a good choice if you need seed funding to start a new business. But a personal loan to fund a business comes with some risk: You’ll be responsible for payments even if your business shuts down.

Recap: These lenders offer the best low-interest business loans

These providers offer some of the lowest interest rates available compared to other similar types of financing.

Visit our guide to the best business loans of October 2024 for more options.

FAQs

What is a good rate for a business loan?

The prime rate is the rate that banks give to their most creditworthy borrowers, and is the benchmark for all other interest rates. So, the closer a business loan’s interest rate is to the prime rate, the better it is. Always compare quotes from multiple lenders to ensure you’re getting the best deal.

Can I get a business loan with bad credit?

Yes, it’s possible to get a business loan with bad credit, but you typically won’t get a competitive interest rate. To get a lower rate, consider putting up collateral, like real estate or equipment, to secure your loan and offset the risk for the lender.

How does business debt consolidation work?

Debt consolidation works by paying off one or more loans with a new loan that has a lower interest rate. 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 loan or home equity loan, though you’ll be personally responsible for repayment if the business fails.

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.

Holly Jennings's headshot
To make sure you get accurate and helpful information, this guide has been edited by Holly Jennings as part of our fact-checking process.
Anna Serio's headshot
Written by

Editor

Anna Serio was a lead editor at Finder, specializing in consumer and business financing. A trusted lending expert and former certified commercial loan officer, Anna's written and edited more than 1,000 articles on Finder to help Americans strengthen their financial literacy. Her expertise and analysis on personal, student, business and car loans has been featured in publications like Business Insider, CNBC and Nasdaq, and has appeared on NBC and KADN. Anna holds an MA in Middle Eastern studies from the American University of Beirut and a BA in Creative Writing from Macaulay Honors College at Hunter College, CUNY. See full bio

Anna's expertise
Anna has written 241 Finder guides across topics including:
  • Personal, business, student and car loans
  • Building credit
  • Paying off debt
Kat Aoki's headshot
Co-written by

Writer

Kat Aoki was a personal finance writer at Finder, specializing in consumer and business lending. She’s written thousands of articles to help consumers make better decisions on their home loans, bank accounts, credit cards, cryptocurrency and more. Kat is well versed in working with leading brands in the real estate, mortgage and personal finance industries, and her expertise has been featured on Forbes Advisor, Lifewire and financial comparison sites like iSelect and realestate.com.au. She holds a BS in business administration from California State University, Sacramento and enjoys hiking and yoga in her spare time. See full bio

Kat's expertise
Kat has written 196 Finder guides across topics including:
  • Mortgages
  • Home equity loans
  • Mortgage refinancing

More guides on Finder

Ask a question

Finder.com 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 finder.com Terms of Use.

Questions and responses on finder.com 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