Low interest business loans

Find out what requirements you'll need to meet in order to get a low interest business loan.

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Finding a low interest loan can save your business hundreds – or even thousands – of dollars when you take out financing. But not every business has the time to research the lowest rates it’s eligible for – after all, time is money. To save you time, compare business loan lenders offering low interest rates and find out the typical eligibility requirements below.

SharpShooter Funding Business Loan

  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $300,000
  • Interest Rate: Starting at 5.49%
  • Requirements: Annual business revenue of $60,000
  • Borrow up to $300,000
  • Online loan application

SharpShooter Funding Business Loan

SharpShooter Funding offers loans up to $300,000 for small business owners who have been business for at least 100 days and can show a minimum of $5,000 in monthly deposits ($60,000/year).

  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $300,000
  • Interest Rate: Starting at 5.49%
  • Requirements: Annual business revenue of $60,000
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Compare business loans in Canada

Name Product Interest Rate Min. Loan Amount Max. Loan Amount Loan Term Minimum Revenue Minimum Credit Score
SharpShooter Funding Business Loan
5.49% - 22.79%
$1,000
$300,000
6 months - 5 years
$5,000 /month
450
SharpShooter Funding offers loans up to $300,000 for small business owners who have been business for at least 100 days and can show a minimum of $5,000 in monthly deposits ($60,000/year).
OnDeck Business Loan
8.00% – 29.00%
$5,000
$300,000
6 - 18 months
$10,000 /month
550
OnDeck offers loans up to $300,000 for small business owners working in approved industries who have been in business for at least 6 months with a minimum monthly revenue of $10,000.
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What’s considered low interest for a business loan?

A business loan with an annual interest rate of 5% to 15% could be considered as low interest. Rates will vary depending on where you borrow from, but tend to start from around 5% and reach as high as 55%. You could possibly find rates as low as 4% from a bank or a credit union, however eligibility requirements tend to be stricter and applications usually take longer to fill out.

Rates are usually displayed as an APR, which is the annual percentage rate. The APR includes both the interest rate and any fees, and is a good representation of the true cost of a loan.

What other costs should I consider?

The fees you’ll pay in addition to your APR depend on the lender and the type of loan you’re applying for. Carefully read the fine print of your loan contract to avoid these costs taking your business by surprise.

Business loan costs to keep in mind

How do I qualify for a low interest loan?

The lowest interest rates typically go to applicants with the strongest credit, which means only a select few borrowers qualify for the strongest rates.

When deciding on your rate, business lenders often consider:

  • Time in business. The longer, the better — especially if you’re borrowing from a bank or a credit union. Generally, your business should be at least one or two years old.
  • Personal credit score. Business owners typically need good to excellent personal credit to qualify for a low interest rate. The higher your credit, the lower the rate you’ll qualify for – but you’ll definitely want a score higher than 650.
  • Revenue and cash flow. Lenders want to see that you consistently make enough money monthly or annually to easily afford a loan repayment. Most lenders require a monthly revenue of at least $5,000 to qualify for a business loan, while some require an annual revenue of at least $100,000.
  • Debt load. High revenue doesn’t mean much if your business has several debt obligations already. You should be able to prove that you can easily afford additional debt repayments.
  • Industry. Lenders often consider industries like trucking and health care high risk. Risky industries can have a hard time qualifying for a loan at all, let alone a competitive rate.

Business loan requirements you’ll need to meet

Which types of providers offer the lowest interest business loans?

The lender you choose can affect your loans interest rate. Start your search for a low interest business loan with the following types of lenders:

Microloans: Small-dollar loans with competitive rates

Generally — though not always — lenders charge higher rates for smaller amounts. New businesses that need only a few hundred or thousand dollars might want to look into a microloan instead.

Microloans tend to come with lower interest rates than your typical business loan. You can find microloans with a small bank, credit union, peer-to-peer lender or an online lender.

4 tips to qualify for a low interest rate

  1. Put up collateral. Securing your business loan with an asset reduces the risk for your lender, making it more likely to approve your business for competitive rates.
  2. Bring on a cosigner. Don’t have great personal credit? Ask a creditworthy relative or friend to cosign your business loan, minimizing the lender’s risk and maximizing your chances of getting a low rate.
  3. Build your credit score. A long-term solution to a poor credit score is to work to build or rebuild it. You’ll find many ways to increase your credit, including strategically paying off your debts and even just reviewing your credit report for errors.
  4. Wait. Don’t need to expand just yet? The longer you’re in business, the more likely you’ll see approval for a low interest loan.

Compare low interest business loans now

Low-cost alternatives to business loans

If you’re not yet sure about your business taking on a loan, look into alternative sources of funding to meet your needs.

Bottom line

Low interest rates can save your business hundreds – or even thousands – of dollars over the life of a business loan. But not every business can qualify — typically the lowest rates are for established businesses with a high monthly or annual revenue and owners with an excellent credit rating. Before applying for a loan, shop around and compare lenders and find out if you can get preapproval for a loan in order to determine what interest rate you’ll be offered. If rates are unfavourable, consider waiting until your business has been operating longer or has a higher revenue, or work towards improving your personal credit score.

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