Best Small Business Loans: Small business loans are a source of financing that business owners can use to operate and expand their businesses. They can apply for these loans through traditional banks, credit unions, and online lenders.
10 Best Small Business Loans in 2024
Our editors are dedicated to providing you with unbiased ratings, the 10 best small business loans, and information. Funds are generally disbursed as a one-time payment and repaid monthly unless otherwise indicated by specific lenders. Our editorial content remains independent of advertiser influence.
01. QuickBridge Business Loans
Best QuickBridge Business Loans
- Rating: 5.0
- Loan amounts: $10,000 to $500,000
- APR Range: Factor rates start at 1.11
- Minimum credit score: 600
- Website: QuickBridge
Editor’s Opinion:
QuickBridge offers small business loans and equipment financing to businesses in all 50 states.
Pros:
- Flexible payment options
- Quick application and funding process
- Early payment discounts
Cons:
- Maximum loan amounts are lower than some competitors
- High minimum annual income requirement ($250,000)
Who Is It Best For?
Business owners need short-term loans with quick financing payback.
Details:
- Eligibility: Minimum credit score of 600, six months in business, minimum income of $250,000 per year
- Response Time: Same-day application decision
Expert Opinion:
QuickBridge’s thorough approval process looks at the overall business, beyond credit score. Approval requires a minimum credit score of 600 and an annual income requirement of $250,000, which is higher than some competitors. Interest is charged as a factor rate starting at 1.10 plus an origination fee (1% to 5%).
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02. OnDeck Business Loans
Best for Short-Term Business Loans
Rating: 4.8
Loan Details:
- Loan amounts: $5,000 to $250,000
- APR Range: Varies
- Minimum credit score: 625
- Website: OnDeck
Editor’s Opinion:
OnDeck offers term loans and lines of credit to businesses in every state except North Dakota.
Pros:
- Term loans and lines of credit with varying repayment terms
- Same-day financing
- Low minimum credit score requirement
Cons:
- Small loan amounts and short repayment terms
- Not available in North Dakota
Who Is It Best For?
Businesses need short-term loans to minimize interest costs.
Details:
- Eligibility: Minimum credit score of 625, one year in business, minimum income of $100,000 per year
- Response Time: Same-day application decision
Expert Opinion:
OnDeck offers quick access to capital for businesses not qualifying for traditional bank loans. Funds are available same-day or next-day without strict credit inquiries but at a high cost.
Read More: 5 Best No Credit Check Business Loans
03. American Express Business Loans
- Rating: 4.7
- Loan amounts: $2,000 to $250,000
- APR Range: Not available
- Minimum credit score: 660 FICO at the time of application
- Website: American Express
Editor’s Opinion:
American Express offers business lines of credit with various options and flexible payment terms.
Pros:
- No early payment penalty
- Four different payment options
- Offers small and large lines of credit
Cons:
- Monthly charges for unpaid balances
- Requires personal guarantee
- Lines of credit over $150,000 have additional criteria
Who Is It Best For?
Businesses seeking short-term lines of credit with transparent costs.
Details:
- Eligibility: Minimum credit score of 660, one year in business, $3,000 monthly income
- Response Time: Up to three business days for funds
Expert Opinion:
The American Express® Business Line of Credit offers flexible terms but may take up to three business days to fund. Not ideal for businesses needing immediate cash.
04. Wells Fargo Business Loans
Best Wells Fargo Business Loans
- Rating: 4.7
- Loan amounts: $10,000 to $150,000
- APR Range: Prime +1.75% to Prime +9.75%
- Minimum credit score: 680
- Website: Wells Fargo
Editor’s Opinion:
Wells Fargo offers business lines of credit and term loans with physical branches nationwide.
Pros:
- Offers physical branch locations
- Transparent loan costs
- Available in all 50 states
Cons:
- Annual fee after the first year
- Requires two years in business
- Requires personal guarantee
Who Is It Best For?
Businesses looking for financing from a bank with physical locations.
Details:
- Eligibility: Minimum credit score of 680, two years in business
- Response Time: Not disclosed
Expert Opinion:
Wells Fargo offers simplified applications and fast approval but may provide relatively small lines initially, requiring six months for potential expansion.
05. Fora Financial Business Loans
- Rating: 4.7
- Loan amounts: Up to $1.5 million
- APR Range: Not disclosed
- Minimum credit score: 570
- Website: Fora Financial
Editor’s Opinion:
Fora Financial offers large business loans and revenue advances.
Pros:
- Large loan amounts up to $1.5 million
- Low minimum credit score requirement
- Prepayment discounts
Cons:
- Short repayment terms of up to 18 months
- Financing slower than some competitors
Who Is It Best For?
Businesses needing large sums or substantial revenue advances.
Details:
- Eligibility: Minimum credit score of 570, six months in business, $20,000 monthly income
- Response Time: Approvals in 24 hours, funding in 72 hours
Expert Opinion:
Fora Financial offers large loans with a quick application process but uses factor rates, making loans potentially expensive.
06. BlueVine Business Loans
Best BlueVine Business Loans
- Rating: 4.5
- Loan amounts: $5,000 to $250,000
- APR Range: Simple interest starts at 5.9% or 7.8%
- Minimum credit score: 625
- Website: BlueVine
Editor’s Opinion:
BlueVine offers short-term business lines of credit with flexible payment structures.
Pros:
- Quick decision and funding
- Low credit score requirement
- Flexible payment options
Cons:
- Monthly income requirement
- Not available in some states
Who Is It Best For?
Businesses need short-term lines of credit with flexible payment options.
Details:
- Eligibility: Minimum credit score of 625, two years in business, $40,000 monthly income for the weekly plan, $80,000 for a monthly plan
- Response Time: Instant funding with BlueVine business checking, 24 hours otherwise
Expert Opinion:
BlueVine offers quick and flexible funding but has high-income requirements and is not available in all states.
07. Funding Circle Business Loans
Best for Long-Term Business Loans: Funding Circle Business Loans
- Rating: 4.5
- Loan amounts: $25,000 to $500,000
- APR Range: As low as 7.49%
- Minimum credit score: 660
- Website: Funding Circle
Editor’s Opinion:
Funding Circle connects businesses with long-term loans through a peer-to-peer marketplace.
Pros:
- Long loan terms of up to seven years
- Financing in as little as 48 hours
Cons:
- Origination fee of 3.49% to 6.99%
- Requires two years in business
Who Is It Best For?
Established businesses need long-term loans for major investments.
Details:
- Eligibility: Minimum credit score of 660, two years in business, no minimum income for most loans
- Response Time: Two days for most loans, up to two weeks for SBA loans
Expert Opinion:
Funding Circle offers clear terms and lower interest rates for long-term loans, ideal for businesses with a stable financial outlook.
08. National Funding Business Loans
Best for Solid Financing Options: National Funding Business Loans
- Rating: 4.5
- Loan amounts: $5,000 to $500,000
- APR Range: Factor rates start at 1.11%
- Minimum credit score: 600
- Website: National Funding
Editor’s Opinion:
National Funding offers short-term working capital loans and equipment financing.
Pros:
- Financing up to $500,000
- Early payment discounts
- Quick funding within 24 hours
Cons:
- Daily or weekly payments
- Potentially high borrowing costs
- High annual sales requirement ($250,000)
Who Is It Best For?
Newly established businesses with high gross sales looking for diverse financing options.
Details:
- Eligibility: Minimum credit score of 600 (575 for equipment financing), six months in business, $250,000 annual sales
- Response Time: Funding within 24 hours of approval
Expert Opinion:
National Funding offers quick and diverse loan options but may not provide long-term solutions for large loans.
09. Fundbox Business Loans
Best for Startup Funding: Fundbox Business Loans
- Rating: 4.4
- Loan amounts: $1,000 to $150,000
- APR Range: Interest rates start at 4.66%
- Minimum credit score: 600
- Website: Fundbox
Editor’s Opinion:
Fundbox offers short-term lines of credit
to startups and small businesses.
Pros:
- Low minimum credit score requirement
- No time in business requirement
- The low minimum revenue requirement
Cons:
- Low loan maximums
- Short repayment terms
Who Is It Best For?
Startups and businesses need short-term financing with minimal qualifications.
Details:
- Eligibility: Minimum credit score of 600, no time in business requirement, $100,000 annual revenue
- Response Time: Approval in as little as 24 hours, funding within one to three days
Expert Opinion:
Fundbox provides quick and accessible funding options for startups but may not be ideal for long-term or larger loans.
Learn About the Best Business Loans
Tips for Comparing Small Business Loans
When comparing small business loans, consider the following tips to ensure you make an informed decision:
1. Prequalify When Possible
- Benefits: Prequalification allows you to see potential loan amounts, rates, and terms based on your financial situation without affecting your credit score.
- How to Prequalify: Provide details about your financing needs, income, and other relevant information to the lender. This typically involves a soft credit inquiry.
2. Determine How You Want to Receive Your Funds
- One-Time Payment: Ideal for large purchases or specific projects. Look for traditional working capital or term loans.
- As Needed: If you need ongoing access to funds, consider a business line of credit that provides flexibility to draw funds as required.
3. Consider Repayment Terms and Flexibility
- Payment Structures: Understand whether the loan requires monthly, weekly, or daily payments. Choose a structure that aligns with your business’s cash flow.
- Flexibility: Some lenders offer more flexible repayment options, which can be crucial if your income is irregular.
4. Beware of Additional Charges
- Fees: Check for origination fees, late fees, prepayment penalties, and other potential charges. Confirm the lender’s fee structure and factor these into your decision.
5. Evaluate the Lender’s Customer Service Options
- Customer Support: Research the lender’s customer service resources and read reviews. Good customer support is crucial if you encounter issues during the loan term.
What Is a Small Business Loan?
A small business loan is a source of financing that business owners can use to cover various operational and growth-related expenses. These loans can be obtained from traditional banks, credit unions, and online lenders, and are often backed by the U.S. Small Business Administration (SBA). They can be used for working capital, equipment purchases, real estate, and other business needs.
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How Do Small Business Loans Work?
Small business loans provide a lump sum of money that can be used for specific purchases or to manage cash flow. They are repaid with interest over a set period. Different types of loans, such as lines of credit, merchant cash advances, and invoice financing, offer varying access to funds and repayment structures.
Common Types of Small Business Loans
SBA Loans
- Types: 7(a), 504, Microloans, Disaster loans.
- Amounts: $30,000 to $5 million.
- Terms: Up to 25 years.
- Pros: Low interest rates, and extended terms.
- Cons: Stricter qualifications, longer approval process.
Term Loans
- Amounts: Up to $500,000.
- Terms: 3 months to 10 years.
- Uses: Equipment, inventory, large purchases.
- Pros: Fixed repayment schedule.
- Cons: May require collateral.
Business Lines of Credit
- Amounts: $2,000 to $250,000.
- Terms: Draw a period of up to 5 years.
- Pros: Flexible access to funds.
- Cons: Higher interest rates, and fees on draws.
Factoring and Invoice Financing
- Amounts: Up to $5 million.
- Terms: Short-term.
- Pros: Quick access to cash.
- Cons: Reduced payment from invoices, responsibility for collections.
Merchant Cash Advances
- Amounts: Varies.
- Terms: Repaid via daily sales or ACH payments.
- Pros: Quick funding.
- Cons: Higher costs, percentage of future sales.
Equipment Financing
- Amounts: Up to $1 million or more.
- Terms: Up to 25 years.
- Pros: Secured by purchased equipment.
- Cons: Limited to equipment purchases.
Commercial Real Estate Loans
- Amounts: Varies.
- Terms: Up to 20 years or more.
- Pros: Lower interest rates, long-term.
- Cons: Additional costs like appraisal and legal fees.
Pros and Cons of Small Business Loans
Pros
- Provides funds for growth or operations.
- Does not require giving up equity.
- Long repayment terms.
- Large loan amounts.
Cons
- Requires personal guarantee or collateral.
- Minimum credit score requirements.
- Long approval and funding process.
- Possible high interest rates and fees.
Where to Get a Business Loan
Banks and Credit Unions
- Pros: Lower interest rates, and established relationships.
- Cons: Stricter borrowing standards, longer approval process.
Online Lenders
- Pros: Flexible requirements, higher approval rates, faster funding.
- Cons: Higher APRs, the potential for higher fees.
How to Get a Business Loan
Steps to Follow
- Determine Loan Type: Assess your borrowing needs and the best loan type for those needs.
- Check Credit Profile: Your credit score impacts loan eligibility.
- Research Lenders: Compare banks, credit unions, and online lenders.
- Gather Documentation: Business plan, financial statements, tax returns, and licenses.
- Submit Application: Follow the lender’s application process and provide the required documents.
Qualifying for a Business Loan
- Personal Credit: Minimum score requirements vary.
- Time in Business: Typically 6 months to 2 years.
- Business Income: Often $100,000 to $250,000 annually.
- Business Checking Accounts: Demonstrates cash flow and stability.
Alternatives to Small Business Loans
Business Line of Credit
- Use Flexible access to funds, for emergency use.
- Pros: Only pay interest on used funds.
Business Credit Card
- Use Business expenses.
- Pros: Flexible qualifications, potential rewards programs.
Crowdfunding
- Use: Raise funds without loans.
- Pros: No repayment required.
- Cons: Competitive and goal-dependent.
Personal Loans
- Use: Tied to personal credit, can finance business needs.
- Pros: Easier qualification, flexible use.
- Cons: Smaller loan amounts.
Small Business Grants
- Use Specific projects.
- Pros: No repayment.
- Cons: Competitive, requires thorough preparation.
