Best working capital business loans in December 2024

National Funding works well for businesses with at least 6 months time in business and established businesses that don’t want to put up business assets as collateral. Borrowers with a personal credit score of 660 are eligible, and you’ll need an annual business revenue of at least $250,000.

• Founded in 1999
• Early payoff discount
• Fast funding
• No collateral required

Business owners with a personal credit score above 550 and more than six months in business are more likely to be approved. Lendzi merchant cash advances are a good fit for companies who can’t get approved for a traditional loan due to credit or annual revenue requirements. It’s best for companies who have built a reliable income stream, as Lendzi takes a percentage of future sales until the debt is repaid.

• Funding may be available within 24 hours
• Application doesn’t require a hard credit inquiry 
• Partners with over 60 lending institutions
• Offers traditional and alternative lending options
• Over 10 years of experience in lending space
• $500 million in loans served 
• Streamlined application process

Startups with at least six months in business and whose owners have a credit score of 570 can apply for a term loan. These requirements are much more lenient than many traditional lenders that require a year or more in business and a 670 credit score or higher. That said, you will need a substantial $240,000 in annual revenue (or $20,000 per month in gross sales). 

• Founded in 2008
• Minimum credit score requirement of 570
• Requires six months in business
• Fast approval and funding
• Prepayment discount
• Funds up to $1.5 million

OnDeck is a good fit for businesses with fair credit that need a low amount of funds quickly. Businesses need at least $100,000 in annual revenue. It’s not available in North Dakota, but residents of all other 49 states are eligible to apply. On the downside, it doesn’t have great interest rates, so it may be best for businesses who plan to pay off their loan quickly to build credit.

• Founded in 2006
• Early repayment incentive for some customers
• Good for fair-credit borrowers
• Operating in 49 states
• Short-term terms available

The SMB Compass bridge loan works best for business owners with a personal credit score of 650 and a debt-to-income ratio of less than 36 percent who need fast funding within 24 to 48 hours. The lender also offers other loans that can be used as working capital, including business lines of credit, which only require a minimum personal credit score of 600.

• Nine types of loans available
• Low credit score requirements
• Low interest rates available
• Operating in 42 states
• Funds companies in almost all industries

Both established businesses and startups may be interested in Wells Fargo as long as they have a top-notch personal credit score of 680. Its BusinessLine® line of credit is a general line for most small businesses offering up to $150,000, while the Small Business Advantage is SBA-backed and good for those with less than two years in business. The Prime line grants the lowest rates to businesses with at least $2 million in annual revenue.

• Founded in 1852
• Multiple line of credit options
• Brick-and-mortar locations
• Rewards program 
• Operates in 37 states and Washington, D.C.
• Online and in-person applications 

Accion Opportunity Fund is a good option for small businesses needing funding for working capital at lower loan amounts with flexible terms. If your business has struggled to get financing elsewhere and wants support in other areas of your business, Accion is a great choice. Additionally, if you’re looking for equipment financing, Accion offers truck and trailer financing. To qualify, you’ll need a 600 FICO score and a commercial driver’s license (CDL) or six months of driving experience. 

• Works with high-risk businesses
• No prepayment penalty
• Mentoring and educational support
• Loans up to $250,000
• Only requires 12 months in business
• Available in 45 states

American Express Business Blueprint™ works well for businesses that are still building revenue and credit history. The business line of credit is available to businesses whose owners have a minimum FICO credit score of at least 660 at the time of application. In some cases, you may need a higher FICO score based on your relationship with American Express, credit history and other factors. You must have started your business at least a year ago and have an average monthly revenue of at least $3,000.

• Minimum monthly revenue requirement of $3,000
• Automated online process
• Accessible minimum requirements
• 6-, 12-, 18-, 24-month terms available
• Fees for terms are: 
  • 3.00% to 9.00% for 6-month loans 
  • 6.00% to 18.00% for 12-month loans 
  • 9.00% to 27.00% for 18-month loans 
  • 12.00% to 18.00% for 24-month loans

Term loans are business loans that provide a lump-sum payment upfront. The business then repays the loan in equal installments over a fixed period. Interest rates are either fixed or variable and are applied to the principal amount borrowed before each repayment. Working capital loans tend to be short term, such as six to 36 months.

A business line of credit lets businesses borrow funds as needs arise up to a set limit. The credit limit can range from $1,000 to $500,000, sometimes more. Once you draw money, your business repays the loan over a fixed time period, such as six, 12 or 18 months. 

The amount of money available to use renews as you pay off the borrowed amount. Your business can use the funds for any reason, typically for small purchases and to close cash flow gaps. 

Invoice financing is secured by a business’s future invoices. The lender advances a percentage of the unpaid invoices to the business. The business then collects payment from its clients and repays the loan. 

This loan improves working capital by giving businesses access to their accounts receivable funds before clients actually pay. The lender is more concerned with the creditworthiness and payment history of the invoiced client. That makes invoice financing an accessible type of business loan for startups and business owners with poor credit. 

While fees vary, invoice financing companies may charge a weekly fee, like 1 percent, based on the outstanding invoices. A one-time processing fee may also apply. The longer the invoice goes unpaid, the more your business will pay. 

With invoice factoring, your business sells its outstanding invoices to a factoring company. The factoring company pays 70 percent to 90 percent of the total invoice amount. It then collects the outstanding invoices, takes out fees and pays your business the rest. 

While fee structures vary, the main factoring fee can range from 0.50 percent to 4.00 percent of the invoice amount. The fee is typically charged based on when the customer pays. It may also be tiered, which means the fee may go up after a set time, like 30 days.

Business credit cards provide an accessible alternative to a loan since they’re relatively easy to qualify for. While the best business cards need a credit score of 670 or greater, some credit card issuers approve businesses with fair or poor credit. 

Issuers are more likely to approve a risky borrower if it’s a secured card or they offer a low credit limit. Credit limits typically go up to $50,000, which is lower than the maximum amounts found with working capital loans. 

Yet APRs match the rates for working capital loans unless you’re a small business with excellent credit. Business credit cards can range anywhere from 18 percent to 35 percent APRs.

Grants provide an avenue of revenue that your business won’t have to repay. Grants are typically offered by federal, state or local governments, but some corporations and non-profits also offer grants.

Access to small business funding is a challenge for many business owners. Rate hikes and bank turmoil have led to lenders tightening credit standards and eligibility requirements. This can make it difficult for startups, bad-credit borrowers and business owners in underserved areas to get approved for small business loans. 

Our experts consider several factors in this category and award higher scores to lenders that offer flexible loan amounts, fast approval and funding and inclusive time in business and annual revenue requirements.

The affordability of a business loan often depends on a business owner's financial profile. A business with high revenue and a flexible budget will likely be able to afford most loan options. Businesses considered high risk, such as startups or those with bad credit, may struggle to find loans with affordable interest rates and reasonable fees. 

We consider a business loan affordable if the payments are manageable, you have the lowest possible rate based on your creditworthiness and there are minimal fees. Lenders that have lower rates, offer rate or fee discounts and have minimal fees receive higher scores. 

A good customer experience requires a lender to be transparent, efficient and responsive. Reputable lenders that value their customers are easy to communicate with, responsive to your questions and concerns and willing to go the extra mile to make sure you have a positive experience for the life of the loan.

Lenders offering online accounts and applications and a range of customer support availability score higher in this category. 

While the Truth in Lending Act (TILA) protects consumers against unfair or harmful lending practices, it doesn’t apply to business loans. This can make it harder to get straightforward and upfront information on loan costs when comparison shopping. We score lenders that make it easy to find rates and fees, as well as eligibility and credit score requirements, higher than those who do not disclose information.

Loan flexibility is finding a loan to meet your needs, even if you don’t have high annual revenue, several years in business or the best credit score. Loan flexibility can look like lenders that offer multiple lending products, variety in loan terms or unique options to give business owners the opportunity to fund their businesses in a way that works for them.

Lenders scoring high in this category offer varied products and services to cater to all types of borrowers and businesses.