OnDeck vs. LendingClub: Which Lender Is Better for Your Small Business?

Compare Small Business Loans

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If you’re thinking about getting a small business loan from OnDeck or LendingClub, we’ve compared both lenders below. Generally speaking, we prefer OnDeck for borrowers who want term loans over $300,000 or who cannot meet some of the eligibility criteria at other lenders. LendingClub is a better fit for borrowers who want longer terms, larger lines of credit or a monthly payment schedule.

OnDeck vs. LendingClub Summary

In general, we recommend OnDeck for business owners who want loans of more than $300,000 or who may not be able to meet specific time in business or credit requirements at other lenders. LendingClub, on the other hand, is better for borrowers who want longer terms, larger lines of credit or monthly repayment schedules.

OnDeckLendingClub
Better for
  • Newer businesses
  • Borrowers with lower credit scores
  • Loans over $300k
  • Longer terms
  • Monthly payment schedule
Minimum Age of Business12 months24 months
Minimum Annual Revenue$100,000 in annual revenue$75,000 in annual revenue months
Minimum Credit Score500620
Personal GuaranteeYesYes
Products Offered
  • Loan
  • Line of credit
  • Loan
Loan Amount Range
  • Loan: $5,000 - $500,000
  • Line of credit: $6,000 - $100,000
$5,000 - $300,000
APR Range
  • Loan: 9.30% - 99.70%
  • Line of credit: 13.99% - 39.90%
7.77% - 35.11%
Loan Terms
  • Loan: 3 - 36 months
  • Line of credit: 6 months
  • Loan: 1 - 5 years
Repayment Options
  • Loan: Daily or weekly
  • Line of credit: Weekly
Monthly
Prepayment PenaltyNoNo
Funding TimeAs fast as 24 hours7+ business days
Apply NowApply at OnDeckApply at LendingClub

When to Use OnDeck Over LendingClub

OnDeck may be a better option than LendingClub if:

  • You own a business that is not yet 2 years old
  • You have a lower credit score
  • You want a term loan for more than $300,000

We recommend OnDeck for borrowers who may have a newer business or a lower credit score. In terms of age of business and credit score requirements, OnDeck is more lenient than LendingClub. To qualify for an OnDeck loan or line of credit, you’ll need to be in business only one year and have a minimum personal credit score of 500. In comparison, LendingClub requires borrowers have at least fair or better credit, which is generally any score above 620, and businesses be at least two years old. For both lenders, borrowers will need to show somewhat substantial annual revenue of at least $100,000 at OnDeck or $75,000 at LendingClub.

OnDeck is also better for borrowers who want term loans of more than $300,000. OnDeck makes term loans from $5,000 to $500,000 with terms from three months to three years while LendingClub only provides term loans up to $300,000. When compared to other online lenders, OnDeck offers some of the highest loan amounts. If you need even more than $500,000, we suggest borrowers consider a traditional bank or SBA loan. These loans can range up to several million dollars or more and can be used to finance large-ticket expenses, such as real estate purchases or business acquisition.

When to Use LendingClub Over OnDeck

LendingClub is a better option than OnDeck if:

  • You want longer terms on your loan or line of credit
  • You want a line of credit for more than $100,000
  • You want a monthly repayment schedule

For borrowers who want longer terms on their loan or line of credit, we recommend LendingClub over OnDeck. This is because LendingClub offers terms from one to five years for loans and 25-month terms for lines of credit. At OnDeck, you can only get terms from three months to three years on loans and six months on lines of credit. We also recommend LendingClub for borrowers who want a line of credit over $100,000. Through LendingClub, you can take out a line of credit from $5,000 to $300,000, whereas OnDeck only provides lines up to $100,000.

Finally, LendingClub provides a standard monthly repayment schedule for both loans and lines of credit. This type of repayment schedule is the same as what you would find with a conventional bank or SBA loan or line of credit. Many online lenders, OnDeck included, will require more frequent repayment, which is not ideal for all types of businesses. OnDeck, for instance, requires borrowers make either daily or weekly payments on loans and weekly payments on lines of credit. For businesses with inconsistent cash flow cycles, this could be an issue. However, if your business’s cash flow cycle is steady, you may prefer smaller, more frequent payments.

How to Choose Between OnDeck and LendingClub

OnDeck and LendingClub have different eligibility criteria, so you first need to think about where you can reasonably qualify for a loan. LendingClub, for instance, has greater time in business and credit requirements than OnDeck, requiring businesses to be at least two years old and borrowers to have credit scores of at least 620. OnDeck only requires businesses to be one year old and borrowers have a credit score of 500 for a loan or line of credit. Both companies have hard annual revenue requirements: LendingClub requires $75,000 and OnDeck requires $100,000. In addition, LendingClub requires that borrowers own at least 20% of the business.

Next, think about the actual terms of the loan you want. How much money do you need? Do you need a term loan or a line of credit? How long and how frequently do you want to repay? Answering these questions will help you decide which product from which company is the best fit for your business. LendingClub offers longer terms on loans and lines of credit, monthly repayment schedules and larger lines of credit up to $300,000. OnDeck, in contrast, offers larger term loans up to $500,000, weekly or daily repayment schedules, and shorter terms up to three years.

Be sure to pay attention to any fees charged by the lender. Both OnDeck and LendingClub charge origination fees, with higher origination fees coinciding with higher interest rates. OnDeck, however, offers reduced rates on origination fees if you take out more than one loan with the lender. This can be an attractive perk if you plan on taking out multiple business loans. And unlike some bank and SBA loans, neither lender charges a prepayment penalty, so you can pay off your loan balance early and save on interest costs.

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