Small-business loans from QuickBooks Capital are one of the most transparent loans on the market, and they have some of the lowest rates we've seen. The only downside: They're only available to QuickBooks Online customers and you need to be invited to apply—you can't just apply without an invitation. If you want to learn more about how these loans compare to other options and what makes them so good, check out the rest of our review.
Why You'll Like QuickBooks Capital
QuickBooks Capital is one of the few lenders to use APRs to demonstrate the cost of its loans, which provides a level of transparency that's hard to find in the small-business financing space. An APR, which stands for annual percentage rate, is the most standard way to compare different loans apples to apples. Additionally, its rates come in at a low 10%-26% or a cost-per-dollar-borrowed range of $1.10 - $1.15. The rate you'll qualify for will depend on various factors, including your personal credit score, cash flow and more.
It is more and more common to see lenders give financing decisions within days or even hours, and QuickBooks Capital is no exception. Because of its visibility into customers' information, its able to prequalify borrowers and prepopulate applications ahead of time. Most applications just need to be validated before submission, and you should get a decision within a few days. Similar to other applications, an application check will only require a soft pull and won't affect your personal credit score. However, QuickBooks Capital will conduct a hard credit pull if you decide to proceed with the loan.
Finally, QuickBooks Capital's loans are easy to qualify for if you're a QuickBooks Online customer. Borrowers are only required to have a personal credit score of 580, an annual revenue of $50,000 and no bankruptcies within the last two years. Outside of the fact that QuickBooks Capital's loans are only available to QuickBooks Online customers right now, these requirements are some of the most lenient that we've seen in the market.
The biggest drawback to QuickBooks Capital is that its loans are only available to QuickBooks Online customers. Additionally, even if you're a QuickBooks Online customer, you can't outright apply. You must be chosen to apply by QuickBooks. That practice itself is severely limiting and really restricts the audience that can even consider loans from QuickBooks Capital. We aren't sure if QuickBooks will open its loans to a larger audience or allow for manual applications.
Secondly, its loans are capped at $100,000. Larger loans can be obtained from traditional lenders like banks or other online lenders, which means QuickBooks Capital loans are better-suited for smaller projects. However, larger loans usually carry stricter requirements, especially loans from banks, so if your borrower profile has relatively weak personal credit scores or annual revenues, you might be restricted to smaller loans. We will mention that QuickBooks Capital has only been in existence since 2017 and that it recently raised the size of its loans from $35,000 to $100,000. If that increase is indicative of anything, QuickBooks Capital is more likely than not to increase its loans in the future.
QuickBooks Capital also lacks flexibility in its financing, since it only offers term loans. QuickBooks Capital has launched in 2017, so additional forms of financing like business lines of credit may be launched as well. We firmly believe that term loans should only be used for one-time purchases where spreading the cost over multiple payments is advantageous. Smaller and ongoing expenditures are better-suited for other forms of financing.
QuickBooks Capital Explained
QuickBooks Capital doesn't offer the outright cheapest loans or the largest, but we rank it highly compared to other lenders because of its transparency. QuickBooks makes an effort to keep the costs of its loans simple, and it shows. It doesn't charge any origination fees or prepayment penalties, so borrowers can save money by paying their loans off early.
|Loan amount range||Up to $100,000|
|Total interest percent||12.00% - 32.00%|
|Financing terms||6 - 12 months|
|Personal guarantee required||Yes|
QuickBooks Online offers an application process that's far simpler than most other lenders. Because of their access to hoards of QuickBooks Online customers' data, they're able to pre-populate most of the data they'd need to collect from customers. Instead, customers are asked to primarily review the information in their applications and ensure accuracy. We've included some screenshots of their application below:
How Does QuickBooks Capital Compare to Other Lenders?
QuickBooks Capital is currently restricted to QuickBooks Online customers, so if you fall outside of that circle but are still interested in comparable loans, we listed some alternative lenders that can be just as competitive.
QuickBooks Capital vs. StreetShares
StreetShares also offers competitive loans up to $250,000 with comparable rates. We'd give StreetShares the edge since it offers larger loans, is accessible to all borrowers and has similar rates with APRs of 8.00% - 39.99%.
StreetShares also offers a business line of credit in addition to its term loan, so borrowers have a choice in what kind of financing they'd like to leverage based on their needs.
QuickBooks Capital vs. Kabbage
Kabbage offers a business line of credit up to $250,000. It's a considerably large line of credit, and it's a far more appealing sum than QuickBooks Capital's $100,000 for borrowers with larger needs. However, the real drawback is in the cost of Kabbage's line of credit. APR's range from 20.00% - 80.00%, which are some of the most expensive rates in the market. Even if you're able to land a line of credit on the lower end of their APR range, you'd still be paying a good chunk more than you would for QuickBooks Capital's cheapest loan.
Kabbage does offer a card that acts as a credit card, which is rare amongst companies that offer business lines of credit. This makes its financing far easier to access and more liquid than QuickBooks Capital's. However, its high rates are tough to ignore and if you're a QuickBooks Online customer, you're most likely going to be better off with a cheaper term loan from QuickBooks Capital.
QuickBooks Capital vs. OnDeck
OnDeck offers a term loan up to $500,000 and a business line of credit up to $100,000. Its business line of credit falls in the middle of the pack relative to the rest of the market in terms of size but its term loan is larger than most available. It's difficult to get precise data on its APRs for its term loans since it only posts annual interest rates (AIR), which don't include all fees, and fees can vary from customer to customer.
However, its term loans start at an AIR of 9.99% and its lines of credit start at an APR of 13.99%. According to some borrowers, APRs for its term loans lines of credit have been as high as 99.40% and 60.80% respectively. Given its potentially high rates, we'd again recommend that borrowers use term loans from QuickBooks Capital if given the choice. Both lenders can provide financing quickly, and they both offer intuitive online experiences. Borrowers should only consider OnDeck if they aren't QuickBooks customers, need larger loans or need a line of credit.