Best Online Business Loans for 2018

Banks and other brick-and-mortar lenders are not your only option for getting a small business loan. With the advent of online lending, business owners have the option to get funds quickly and conveniently without a mound of paperwork. While online business loans aren’t advisable in all situations, there are many times when they can make more sense than a traditional loan.

Best Online Business Term Loans

The online business lending industry has exploded in the last few years with many companies in the space offering a variety of loan products. In the table below, we take a look at some of the largest and most well-known online lenders that provide term loans.

LenderBest for...How to QualifyLoan AmountsAPR RangeRepaymentApply
OnDeck

(Read Review)

  • Lower credit scores
  • Larger term loans
  • Personal credit score: 500
  • Annual revenue: $100k
  • Time in business: 1 year
$5,000 - $500,0009.30% - 99.70%3 - 36 monthsApply Now
LendingClub

(Read Review)

  • Lower revenue businesses
  • Personal credit score: 620
  • Annual revenue: $75k
  • Time in business: 2 years
$5,000 - $300,0007.77% - 35.11%1 - 5 yearsApply Now
Funding Circle

(Read Review)

  • Larger term loans
  • Personal credit score: 620
  • Annual revenue: None
  • Time in business: 2 years
$25,000 - $500,0007.35% - 33.00%6 - 60 monthsApply Now
SmartBiz

(Read Review)

  • Faster SBA loans
  • Personal credit score: 650-675
  • Annual revenue: Varies
  • Time in business: 2 years
$30,000 - $5 million5.85% - 8.95%10 or 25 yearsApply Now
Fundation

(Read Review)

  • Larger term loans
  • Personal credit score: 620
  • Annual revenue: $100k
  • Time in business: 1 year
$20,000 - $500,0007.99% - 29.99%1 - 4 yearsApply Now
StreetShares

(Read Review)

  • Small, growing businesses
  • Personal credit score: 600
  • Annual revenue: $25k
  • Time in business: 1 year
$2,000 - $100,0008.00% - 39.99%3 - 36 monthsApply Now
QuarterSpot

(Read Review)

  • Lower credit scores
  • Unsecured loans
  • Short-term loans
  • Personal credit score: 550
  • Annual revenue: $200k
  • Time in business: 1 year
$5,000 - $200,00020.00% - 48.00%9, 12 or 18 monthsApply Now
SnapCap

(Read Review)

  • Lower credit scores
  • Newer businesses
  • Larger term loans
  • Personal credit score: 550
  • Annual revenue: $100k
  • Time in business: 9 months
$5,000 - $600,00019.99% - 49.99%3 - 36 monthsApply Now
PayPal Working Capital

(Read Review)

  • PayPal merchants
  • Lower credit scores
  • Personal credit score: None
  • Annual revenue: $15k - $20k in PayPal sales
  • Time in business: 3 months
$1,000 - $200,00015.00% - 30.00%Up to 18 monthsApply Now
Credibly

(Read Review)

  • Newer businesses
  • Unsecured loans
  • Lower credit scores
  • Personal credit score: 500
  • Annual revenue: $120k
  • Time in business: 6 months
$5,000 - $250,0001.15x - 1.49x6 - 24 monthsApply Now
Guidant Financial

(Read Review)

  • SBA loans
  • Personal credit score: 640-690
  • Annual revenue: Varies
  • Time in business: Varies
$50,000 - $150,0006.50%10 yearsApply Now

Other Online Business Loan Options

If you don’t want a standard term loan, you can also get a line of credit, equipment loan or accounts receivable financing (among other products) online. In fact, you may be able to find a financing product online that your bank or credit union doesn’t offer.

LenderBest for...How to QualifyLoan AmountsAPR RangeRepaymentApply
OnDeck

(Read Review)

Line of credit
  • Minimum personal credit score: 500
  • Minimum annual revenue: $100,000
  • Minimum time in business: 1 year
$6,000 - $100,00013.99% - 39.90%6 monthsApply Now
Kabbage

(Read Review)

Line of credit
  • Minimum annual revenue: $50,000 ($500,000 for lines up to $150,000)
  • Minimum time in business: 1 year (3 years for lines up to $150,000)
$2,000 - $150,00020.00% - 80.00%6 or 12 monthsApply Now
StreetShares

(Read Review)

Line of credit
  • Minimum personal credit score: 600
  • Minimum annual revenue: $25,000
  • Minimum time in business: 1 year
  • Must be incorporated or LLC (sole proprietorships allowed in some states)
$5,000 - $100,0008.00% - 39.99%3 - 36 monthsApply Now
Fundbox

(Read Review)

  • Line of credit
  • Invoice factoring
  • Minimum annual revenue: $25,000
  • Minimum time in business: 6 months
  • Average daily bank account balance of at least $500
  • No bankruptcies in last 2 years
  • Fewer than 9 days in a month of negative balances
  • Less than 5% of debit transactions as NSF
LOC: $100 - $100,000 Factoring: $100 - $100,000LOC: 15.00% - 59.00% Factoring: 13.00% - 60.00%LOC: 12 weeks Factoring: 12 or 24 weeksApply Now
BlueVine

(Read Review)

  • Line of credit
  • Invoice factoring
  • Personal credit score: Minimum personal credit score: 600
  • Minimum annual revenue: $120,000
  • Minimum time in business: 6 months
  • No more than three non-sufficient fund fees in the past two months
LOC: $5,000 - $250,000 Factoring: $20,000 - $5 millionLOC: 15.00% - 78.00% Factoring: 15.00% - 68.00%LOC: 6 months Factoring: Up to 90 daysApply Now
Currency

(Read Review)

Equipment financing
  • Personal credit score: 650
  • Annual revenue: Varies
  • Time in business: Varies
$50,000 - $15 million1.40% - 10.1%Up to 5 yearsApply Now

When Should You Use an Online Business Loan?

There are certain instances where going online for a business loan makes more sense than going to a bank or credit union. We highlight some of the main reasons below:

You need funds quickly: Online lenders are known for their speedy funding times, with some companies(such as OnDeck) getting you funds in as fast as 24 hours. Banks, on the other hand, can take weeks or months to approve your application and disburse funds to your bank account.

You have an average or below average personal credit score: Banks and online lenders will evaluate your personal credit score during the loan application process. If you have a personal credit score under 680, you will have a harder time getting approved at a bank or traditional lender. In this case, it’s worth considering an online loan as some companies have no credit criteria or only require borrowers to have scores of 500 and above.

Your business has no or poor business credit: Many online lenders have no set standards regarding your business credit score. Some banks do not have standards either, but more and more do--especially after the SBA began requiring a certain FICO SBSS score for some of its loan programs. So if your business doesn’t have a credit score yet or has a less than stellar one, you might want to consider an online business loan.

Your business is not yet profitable or has low annual revenue: While most online lenders have yearly revenue requirements, these range from $25,000 up to $200,000, making online lending accessible for a variety of businesses. In particular, we recommend considering an online business loan if your business has less than $200,000 in annual revenue.

Your business is not yet two years old: Getting a loan for a new business is hard, regardless of which lender you approach. However, some online lenders have more lenient time in business requirements, lending to businesses as young as three months old. Invoice factoring companies, in particular, will work with businesses as young as three to nine months.

You need less than $500,000: It costs banks roughly the same to underwrite a $100,000 loan as a $10 million loan, so most banks won’t look at applications for smaller loan amounts. For small business owners, this can be very frustrating. Thankfully, most online lenders are happy to fill this funding gap by offering loans as low as $5,000.

Compare Small Business Loans

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