Best Business Loans for Bad Credit in January 2024

Small business loans help businesses reach new heights. However, for borrowers with low personal credit scores (think scores below 670), getting approved can be difficult.

Small Business Administration (SBA) microloans are ideal for people with bad credit because they often have less stringent eligibility requirements and lower interest rates than other government-backed loans. However, the loan application process can be lengthy and the maximum amount you can borrow is only $50,000. Therefore, many small and medium-sized enterprises with low credit scores will need to rely on private financial institutions.

If you need to accelerate the growth of your small business but have a low credit score, consider these business loans for bad credit. We evaluated each loan based on a variety of characteristics, including minimum and maximum loan amounts, repayment period, required personal credit score, Better Business Bureau rating, and applicable business requirements. (Learn more about our methodology below.)

According to the lender, OnDeck boasts a fast financing process that starts with application and takes just 10 minutes to complete. The company’s minimum credit score requirement for term loans is 625, making it an accessible option for people with low credit scores. To qualify, the lender must be in business for at least a year, have annual revenue of at least $100,000, and have a business bank account, so this lender is ideal for newly launched businesses and businesses. It may not be the best option for people who need capital to get started. -Up.

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Kiva uses crowdfunding to lend money to small business owners. This lender has no minimum credit score requirements, making it an accessible option for those who don’t qualify for loans that require a higher credit score. The maximum amount of funding provided is $15,000, so it is aimed at companies with low start-up costs.

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State funding is best suited for borrowers with lower credit scores who need to borrow larger amounts of money. When applying for a bad credit loan, this lender considers factors such as business hours and annual gross sales. Eligible borrowers can apply for up to $400,000 in financing, which is much higher than the $250,000 maximum typically offered by small business lenders.

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Greenbox Capital allows borrowers to obtain up to $500,000 in business lines of credit or up to $250,000 in secured loans. Secured loans are easier to get approved because you have to put up some collateral to get the loan. Lenders will consider factors beyond your credit when evaluating your application, including business revenue, cash flow, vendor payment history, years in business, and public records.

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OnDeck has lent more than $15 billion to U.S. businesses and has an impressive A+ rating from the Better Business Bureau (BBB). Potential borrowers can check their eligibility without hurting their credit score.

Eligible Borrowers

You must have been in business for at least one year, have annual revenue of $100,000, and have a business bank account.

Loan amount

$5,000 to $250,000

Financing conditions

up to 18 months

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Kiva is a peer-based lending platform that offers crowdfunded loans. Crowdfunding involves raising a loan by asking many people to donate small amounts of money and collecting a lump sum. Once you apply, you have 15 days to invite friends and family to lend money to your business. Kiva then exposes that network to a network of lenders to help you raise money. Kiva has helped borrowers raise more than $1 billion to date, according to the company’s website.

Eligible Borrowers

You must be at least 18 years old, reside in the United States, and use the funds for business purposes only.

Loan amount

Up to $15,000

Financing conditions

up to 3 years

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National Funding offers three main financing solutions to small businesses: working capital loans, short-term business loans, and equipment capital loans. We offer loans that service a variety of industries, including beauty and wellness, restaurants, agricultural businesses, and more. This financier has provided over $4.5 billion in financing to companies and has an A+ rating from the BBB.

Eligible Borrowers

Must have been in operation for at least 6 months and have annual sales of at least $250,000

Loan amount

Up to $400,000

Financing conditions

Up to 5 years depending on loan type

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Greenbox Capital offers a wide range of financing options for small businesses, including secured loans, merchant cash advances, and business lines of credit. It funds companies in most industries, including some high-risk industries. Greenbox is not aimed at startups, as companies must be in operation for at least five months to receive funding.

Eligible Borrowers

Must be in operation for at least 5 months

Loan amount

Up to $500,000

Financing conditions

not disclosed

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Small business loans with the best interest rates and terms are typically offered to borrowers with higher credit scores. But that doesn’t mean you can’t qualify for a loan even if your credit score is low. Some borrowers adjust their terms and requirements to suit the needs of borrowers with poor credit.

CNBC Select’s mission is to provide quality service journalism and comprehensive consumer advice to help readers make informed decisions about their money. All small business loan reviews are based on rigorous reporting by a team of expert writers and editors with extensive knowledge of loan products.. While CNBC Select earns commissions from affiliate partners on many offers and links, we create all content without input from commercial teams or outside parties and adhere to journalistic standards and ethics. We are proud of our products. To learn more about how to choose the best bad credit small business loan providers, check out our methodology.

To determine which small business loans offer the best financing terms, CNBC Select analyzed 12 U.S. loans offered by both online and brick-and-mortar lenders. We narrowed down our rankings by considering only traditional loans, such as term loans, equipment loans, commercial real estate loans, microloans, and franchise loans. We did not evaluate business lines of credit, invoice factoring/financing, or merchant cash advances in this summary. This is because they work differently than traditional term loans, which either have a longer application process (such as SBA loans) or can be paid in one lump sum. It is repaid over a certain period of time.

We compared each small business loan on a variety of features, including:

• Minimum and maximum loan amount
• length of term
• credit score required
• Application requirements
• Streamlined application process
• expenditure of funds
• customer support
• Business Bureau Better Rating
• Customer reviews (if available)

Interest rates and fee structures for small business loans are subject to change without notice and often fluctuate based on the prime rate. However, once you agree to a loan agreement, a fixed rate APR ensures that your interest rate and monthly payments will remain the same throughout the life of your loan. The annual interest rate, monthly payments, and loan amount will vary depending on your credit history and creditworthiness.

For small business loans, lenders will perform a hard credit check and require a complete application. This may require proof of income, identity verification, address proof, etc. for both individuals and businesses. You may also need to put up collateral, such as business equipment, real estate, or personal assets.

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