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What to know first:
Small business working capital loans can help you cover operating expenses when times get tough, allowing you to cover payroll, pay rent and keep utilities going while you work on your cash flow.
Many lenders keep lending criteria lenient for this purpose, offering loans that have low credit score and revenue requirements. Working capital loans can be used in combination with other kinds of funding, such as business lines of credit, microloans and merchant cash advances.
Check out Bankrate’s picks for the best working capital loans. These top lenders offer relaxed requirements, fast funding and a wide range of loan amounts you’d need to cover most operational expenses.
Get started on funding your business today
Answer a few questions and get matched with trusted financing solutions from our sponsored partner.
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|
National Funding: Best for unsecured working capital loans
Bankrate Score = 4.4/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$5k-$500K
Term: 4 - 24 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
Hire new employees to support your business growth
Flexible payment options are available
Stock more best-selling items during your busy selling seasons
Maintain daily operations even through gaps in cash flow
Continue running your business seamlessly during seasonal lulls
Disclosures:
This is not a guaranteed offer of credit. Rates and terms for business credit products are subject to underwriting guidelines, may be provided by third parties, and are subject to lender approval. Approved funding amount is based on eligibility. Actual eligibility may vary. Restrictions may apply. Application is subject to approval by the lender and is based on factors such as business type, time in business, annual sales, average business bank account balances, personal credit and other variables deemed relevant by the lender. Products offered by National Funding, LLC and affiliates are business products only. In California, products are made or arranged pursuant to a California Financing Law License. License number: 603A169.
Pros
Fast funding
Early payoff discount
Cons
Limited monthly payment option
Potentially high interest rates
$250,000 minimum annual revenue required
You can apply online or by phone. National Funding charges an origination fee of between 1 and 3 percent for working capital loans and requires a personal guarantee. Repayment schedules are daily and weekly, but select applicants may qualify for a monthly payment option. If the working capital loan is repaid within the first 100 days, borrowers receive a 7 percent discount on the remaining balance.
National Funding operates in all states.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
660
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Yes
Minimum time in business requirement:6 months
Minimum business annual revenue:$250,000
OnDeck: Bankrate 2025 Award Winner Best lender for startups
Bankrate Score = 4.5/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$5k-$250K
Term: 3 - 24 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
You can apply for a loan with OnDeck online or by phone at 888-269-4246. Most applicants receive a decision in minutes, and funds are available as soon as the same business day or within two to three days. OnDeck charges a loan origination fee of up to 4 percent. For a business line of credit, you may be required to make a $1,000 draw at origination, depending on where you live and your application.
Funding isn’t available in North Dakota.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
625
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Bankrate Score = 4.2/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$10k-$500K
Term: 4 - 24 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
Finance daily business operation and have flexibility for expansion
Access to short-term cash for immediate expenses like paying rent
Supplement late-paying clients
Get the funds to make improvements with renovations without impacting day-to-day cash flow
Cash flow for inventory, materials, and marketing
Disclosures:
This is not a guaranteed offer of credit. Rates and terms for business credit products are subject to underwriting guidelines, may be provided by third parties, and are subject to lender approval. Approved funding amount is based on eligibility. Actual eligibility may vary. Restrictions may apply. Application is subject to approval by the lender and is based on factors such as business type, time in business, annual sales, average business bank account balances, personal credit and other variables deemed relevant by the lender. Products offered by QuickBridge and affiliates are business products only. In California, products are made or arranged pursuant to a California Financing Law License. License number: 603J292.
Pros
Streamlined application process
Fast funding times
Early payoff discount
Cons
Interest rates and fees not stated online
$250,000 minimum annual revenue requirement
What to know
QuickBridge offers an easy online application. After applying, a Funding Specialist will contact you. If you decide to move forward with a lending product, you’ll formally apply. Upon final approval, you could receive funds in just one business day. Repayment schedules are daily or weekly.
QuickBridge uses factor rates for its products. Origination fees are between 1 and 3 percent.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
660
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Bankrate Score = 4.4/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$25k-$5M
Term: 6 - 300 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
Fixed Interest rates and flexible repayment options
Interest only solutions available
Flexible use of funds
Prequalify without impacting your credit
Disclosures:
SMB Compass's financing programs are not available in California.
Pros
Fast funding
Competitive interest rates
Cons
Not available to sole proprietorships
Not available in all 50 states
You can apply online with SMB Compass without impacting your credit score. For questions, SMB Compass has a live chat feature on their site, or you can call 888-853-8922 to speak with a representative.
Some loan products come with a 1 to 3 percent closing fee. Funding isn’t available in the following states: CA, HI, KY, MN, NH, OH, UT and WI.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
680
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Bankrate Score = 4.5/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$5k-$1.5M
Term: 6 - 18 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
Fixed terms - up to 18 months to repay - make the Small Business Loan a hassle-free lending solution for growing businesses that need fast working capital for expansion, cash flow management, or other business operations
No collateral required
Prepayment discounts
Soft credit pulls for approvals
Borrow $5,000 to $1.4 million
Disclosures:
Fora Financial provides business capital, including business loans and Revenue Based Financing, directly and through a network of unaffiliated third-party funding providers. All offers will depend on your business meeting at the time of submission our prequalification and/or underwriting criteria, which includes, but is not limited to, business & personal credit history, time in business, cash flow, revenue consistency, industry-specific underwriting rules. Business loans are offered by Fora Financial Business Loans LLC or, in California, by Fora Financial West LLC, a licensed California Finance Lender, License No. 603J080. Revenue Based Financing is offered by Fora Financial Advance LLC.
Pros
Possible early repayment discount
Soft credit check at application
Minimum FICO score of 570
Cons
Maximum factor rate is fairly high
Few types of loans
Steep annual revenue requirement
WHAT TO KNOW
Fora has a remarkably fast approval time, with the company advertising a response within just four hours. The company does a soft credit check when you apply for a loan with a full check happening only once you’ve been approved. The company also puts discounts on early repayments and has no limits on how you used the money you borrowed.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
570
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Bankrate Score = 4.3/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$2k-$250K
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
Pay a monthly fee each month you have an outstanding balance
Digital application and onboarding journey; applications are not accepted by phone
Customers can apply 24/7 and access their account information 24/7
Disclosures:
Total monthly fees incurred over the loan term range are: 3-9% for 6-month loans, 6-18% for 12-month loans, 9-27% for 18-month loans, and 12-18% for 24-month loans
The required FICO score may be higher based on your relationship with American Express
All businesses are unique and are subject to review and approval
**American Express® Business Line of Credit offers two loan types, installment loans and single repayment loans for eligible borrowers. All loan term types, loan term lengths, and pricing are subject to eligibility requirements, application, and final approval. This article contains general information about the American Express® Business Line of Credit installment loan type only.**
Pros
Online application
Flexible access to funds
Multiple term options
Cons
High fees on longer terms
Personal guarantee required
Minimum draw amounts
Business credit score: N/A
Personal credit score: Minimum FICO score of at least 660* at the time of application
Personal guarantee requirement: Yes
Minimum time in business requirement: Must have started your business at least a year ago
Minimum business monthly revenue: Average monthly revenue of at least $3,000
* All businesses are unique and are subject to approval and review.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
660 *
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Yes
Minimum time in business requirement:1 year
Accion Opportunity Fund: Bankrate 2025 Award Winner Best CDFI for small business loans
Bankrate Score = 4.1/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$5k-$250K
Term: 12 - 60 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
You can apply online or call 1-866-720-3215 to speak with a representative. Accion Opportunity Fund checks your personal credit with a soft pull so that it won’t affect your credit score. To qualify for a loan with Accion, you’ll need at least $50,000 in annual revenue and 12 months in business. They don’t charge prepayment penalties and your origination fee could be as low as 3 to 5 percent. Interest rates range from 8.49 percent to 24.99 percent.
While their working capital loan doesn’t require any specific collateral, you will need a blanket lien on loans over $50,000.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
N/A
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
No
Minimum time in business requirement:1 year
Minimum business annual revenue:$50,000
Wells Fargo Business: Bankrate 2025 Award Winner Best small business lender for good-to-excellent credit
Bankrate Score = 4.2/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$10k-$150K
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
To apply for the Wells Fargo BusinessLine® line of Credit or Wells Fargo Small Business Advantage line of credit, you can go online or visit a branch. To apply for the Wells Fargo Prime Line of Credit, call 1-844-807-5060. The BusinessLine® line of credit and Small Business Advantage® line of credit require a personal guarantee for all owners over 25 percent and 20 percent, respectively. The Prime Line of Credit requires collateral. The BusinessLine® line of credit also comes with an annual fee after the first year.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
680
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Bankrate Score = 4.3/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$5k-$5M
Term: 3 - 15 months
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
In a lending landscape filled with obstacles, Lendzi shines as a beacon of transformation. We rewrite the script by:
Welcoming Bank Turndowns: When banks decline, we step up, offering a second chance for success.
No Credit Check, No Limits: We see beyond credit scores, enabling businesses to thrive without unnecessary barriers.
Lightning-Fast Approvals: In under two hours, opportunities are unlocked, and growth accelerates.
Tailored Solutions: Personalized plans cater to your unique business needs.
Empowering with No Obligation: Explore without commitment, ensuring the right choice for your business.
With Lendzi, "no" evolves into "now." We're not just financiers; we're partners in your journey to triumph.
Pros
Fast funding
High lending amounts
Cons
Potentially high interest rates and fees
Mixed loan details from representatives
To be matched with the right option for your small business, you can apply online with Lendzi or speak with a representative by phone. There is only a soft credit check when applying, so your credit score won’t be affected.
Since Lendzi isn’t a direct lender, rates, fees and requirements will vary depending on the lender you’re matched with.
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
550
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
Yes
Minimum time in business requirement:6 months
Minimum business annual revenue:$100,000
SmallBusinessLoans.com: Best for personalized funding
Bankrate Score = 4.4/5 Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
Loan amount
$5k-$500K
Interest rate
Interest will typically be quoted as an annual percentage rate (APR), which reflects interest rate and any other charges and fees you may have to pay.
Must fill out an application to know what you qualify for
May not be eligible for every product
Limited information online
SmallBusinessLoans.com is a loan marketplace that matches small business owners with lending partners and products. Several funding options are available, including lines of credit, equipment financing and leasing, merchant cash advances and term loans. Funding amounts and repayment terms will vary depending on the lender and product you're matched with.
It's easy to apply online, and business owners can receive funds in as little as 24 hours
Business credit score:
There are four companies that assess business credit scores: Dunn & Bradstreet (D&B), Experian, Equifax and FICO. Each
calculates their own scores based on various scales. D&B and
Experian rank on a 1-100 scale. FICO scores on a 0-300 scale.
Equifax generates 3 separate scores based on business payment
index (1-100), business credit risk (101-992), and business
failure (1,000 - 1,880).
N/A
Personal credit score:
A FICO score/credit score is used to represent the creditworthiness of a person and may be one indicator of the loans you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.
660
Personal guarantee requirement?:
This is a form of protection for lenders requiring the borrower to repay the loan from their personal assets if the
business defaults. A personal guarantee can help some
businesses access credit that typically wouldn't qualify.
A closer look at our top working capital business loans
Get more detail on Bankrate’s lender here with highlights and unique features. Bankrate’s expert insights include each lender's loan offerings and what we like about them.
National Funding: Best for unsecured working capital loans
Overview: Since 1999, National Funding has provided funding to over 75,000 small businesses with a focus on term and equipment loans. It’s known for its quick online applications, with approvals in as little as 24 hours. National Funding offers high loan amounts up to $500,000 with the flexibility to use the funds for any business expense.
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
Lendzi: Best for merchant cash advance
Overview: Lendzi is not a direct lender, instead partnering with lending institutions to connect businesses with an organization that can fund their financial needs. The company works with over 60 partners and has serviced over $500 million in loans to date. Because Lendzi works with so many partners, a single application represents many chances for funding approval.
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
Fora Financial: Best for startups
Overview: Founded in 2008, Fora Financial has helped thousands of small businesses secure short-term funding. It works with businesses that have less-than-perfect credit, providing access to term loans or revenue advances. Businesses can secure working capital loans for as little as $5,000 or up to $1.5 million.
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: Best for fast funding
Overview: 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 and a 625 credit score. 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.
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
SMB Compass: Best for bridge loan
Overview: SMB Compass is an online lender that’s funded millions of dollars in small business loans over the last seven years. It provides an impressive selection of nine business loans with low starting rates to boot. SMB Compass offers bridge loans that go up to $5 million, a high loan amount compared to other lenders. It’s also transparent about interest rates. Interest rates vary, starting at 12.00 percent APR, which is competitive for a short-term loan.
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
SmallBusinessLoans.com: Best for personalized funding
WhileSmallBusinessLoans.com doesn’t offer loans directly, it acts as a small marketplace that helps business owners connect with funding partners. Business owners can access over $500,000 in loans with a maximum of $5.5 million, with interest rates starting at 10 percent.
SmallBusinessLoans.com works best for small businesses with fair to excellent credit and who are looking to match with the right partner for them. Once you fill out the application, the site instantly matches you with lenders that best fit your business’ funding needs.
Loan matching and comparison
Speedy funding
Quick application process
Variety of loans to choose from
Wells Fargo: Best for business line of credit
Overview: Wells Fargo is a bank with a brick-and-mortar presence providing flexible business loan options for both small and established businesses. It offers low starting rates on three different business lines of credit and SBA loans. Wells Fargo offers flexible business lines of credit options, with varying credit limits and features to serve different purposes.
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: Best for low interest
Overview: Accion Opportunity Fund is a nonprofit offering alternative lending for small businesses that can’t gain funding in the traditional market. The majority of its clients come from underserved communities, such as businesses in low-income areas. This alternative lender focuses on microloans with low interest rates starting at 8.49 percent. As a nonprofit, Accion Opportunity Fund can keep rates low since it doesn’t aim to turn a profit from its loans.
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.
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™: Best for fair credit
Overview: American Express Business Blueprint™ provides a business line of credit that’s accessible to many small business owners because of its eligibility requirements. It offers a credit limit ranging from $2,000 to $250,000 if your business qualifies. The company considers businesses with a lower credit score than many competitors, who often require a FICO score of at least 680.
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
What are working capital business loans?
A working capital loan is designed to infuse cash into the business for everyday operations, such as marketing, inventory or payroll. These loans boost your business’s working capital, which is your current assets minus liabilities. The positive amount left over is the amount you can use for day-to-day purchases or to expand your business.
Working capital business loans can help bolster your cash reserves when your cash flow gets low, or help weather a period of slow sales. You don’t have to limit yourself to a working capital loan. You can use other loans to boost your business’s working capital, including short-term loans and business lines of credit.
How does a working capital business loan work?
Working capital loans for small businesses tend to offer short repayment terms like six to 36 months. They may also offer fast loan approvals and funding within one to three days due to the nature of the loan.
Depending on the type of loan, working capital loans may be easier to qualify for than standard term loans. They may require only a year in business and a personal FICO score of 500 to 600.
Most working capital loans will have a set repayment schedule with fixed payments. If you open a business line of credit, your credit limit will reset as you pay off the loan, allowing you to borrow more funds as needed.
Requirements for a working capital business loan
Every lender sets its own standards for granting working capital loans to small businesses. In general, these loans have lenient eligibility criteria since they’re meant for small, everyday purchases.
Requirements you can expect include:
Annual revenue: Lenders require your business to make a specific amount monthly or annually to show steady cash flow. For working capital loans, these can range from $36,000 to $250,000 annually.
Time in business: Most lenders prefer businesses to show they have several years in the market. But working capital loans can offer loans to businesses with three months to two years in business.
Credit score: The minimum credit score is based on how much risk individual lenders are willing to take on. It’s typically set between a 625 and 680 FICO score, but some lenders go as low as 500.
Industry: Lenders evaluate your business’s financial statements and risks for your industry. In some cases, the lender posts a list of industries it won’t work with, such as consulting or financial services.
Bankrate Insight
Lenders often use your personal credit score to determine creditworthiness, though a business credit score may be weighed for more established businesses.
Types of working capital business loans
Your business can use various types of business loans to boost working capital. Bankrate offers resources to help you find the best type of loan to fit your needs. Depending on the specific use and your business qualifications, consider these options:
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.
A merchant cash advance is a business loan alternative that helps you get quick funding in exchange for pledging a percentage of your future sales. MCAs charge a factor rate such as 1.10 or 1.50, which is a fee that gets multiplied by the total amount owed. Your business repays the loan with credit card sales until the loan is paid off. Since fees tend to be high, you may opt for an MCA only as a last resort if you can’t qualify for other loans.
Pros and cons of working capital loans
Working capital loans work well for small businesses needing fast funding to cover everyday expenses and gaps in cash flow. But you might pay for the convenience. Make sure to consider the pros and cons of working capital loans before you apply for one.
Pros:
Get cash fast. Many lenders fund working capital loans fast — usually within a few days — though it depends on the type of loan and how much you need.
Typically used as needed. Unless you go with a term loan, your business can typically use the funds for any expenses. You may have to state the reason you need the funds for a term loan.
Relaxed eligibility requirements. Businesses with bad credit can find loans to increase working capital, including alternative loan options tied to accounts receivable.
Cons:
Short, aggressive repayment terms. Most working capital loans require repayment within a few months, such as six or 18 months. They may also require daily or weekly payments, an aggressive schedule that cuts into profits.
Potentially high interest or fees. Some working capital loans come with high interest rates, upwards of 75.00 percent, while others charge factor rates and additional fees like processing fees. Factor rates are known for converting to a high interest rate since they’re often used with risky types of loans.
Low loan amounts. The loan amount that you qualify for may be lower than a standard business loan. This may be due to aggressive repayments or a risky credit profile.
Get to know your credit score and report. Understanding your creditworthiness will help you narrow down which lenders and financial products are accessible to you. Business lenders often look at your business and personal credit scores.
Decide which type of business loan you want. There are short-term loans, traditional term loans, SBA loans and lines of credit available for use as working capital. Each product has different pros and cons. You can use Bankrate’s top business loan list to help you figure out which lenders work best for you.
Figure out how much loan you can afford. Factors like gross annual revenue and current debt will help inform how much you will get approved for. Don’t borrow more than you can responsibly pay back. You can use Bankrate’s business loan calculator to determine whether you can afford the monthly repayments.
Compare loans and lenders. Start looking at lenders who offer the type of working capital loan you want. Be sure to compare the same term length and loan amounts.
Gather documents. Your loan application will require a lot of financial disclosures, and preparing the information in advance will expedite the process. Required documentation may include articles of incorporation, business name registration, business tax forms, profit-and-loss statements and outstanding debt information.
Apply for the loan. Many lenders have an online application process, making applying relatively easy if you have your documents in hand. Depending on the lender, there may be an underwriting process that requires someone to reach out to you for more information.
Where to get a working capital loan
Nearly every lender offers loans that can boost your working capital, though not every lender provides working capital loans specifically. The best place for your business to get a working capital loan will depend on your business’s creditworthiness. Options to consider:
Banks
Traditional banks offer a variety of business loans that you can use for operational expenses. These may include business lines of credit, term loans or working capital loans. But banks tend to have tight lending requirements, such as requiring two years in business and a personal credit score of 670 or higher.
Online lenders
Online lenders work well for businesses with fair-to-bad credit or those needing fast funding. The minimum FICO credit score set by these lenders can range from 500 to 650. Most online lenders also fund within 24 to 72 hours, ideal if you need extra working capital right away.
SBA lenders
Nearly any SBA loan can be used as a business working capital loan, such as the 7(a), Express or Microloan. Express loans work well if you need fast SBA funding, but expect other SBA loans to take 30 to 90 days for approval.
These loans are backed by the U.S. Small Business Administration, and lenders are required to keep interest rates below the SBA’s maximum rate. Your business still must meet the criteria set by the lender, which may be strict. Depending on where you live, you may be able to work with a Community Advantage lender, which offers SBA 7(a) loans to businesses in underserved communities.
Community Development Financial Institutions (CDFIs)
Underserved businesses that can’t get access to traditional funding can also get a loan from a Community Development Financial Institution (CDFI). CDFIs lend to specific communities and provide education to support the small business’s success. CDFIs can be banks, credit unions, non-profit organizations or loan funds.
Minority Depository Institutions (MDIs)
Minority Depository Institutions (MDIs) are defined as institutions with either:
Mostly owned by minority individuals or
Most of its board is made up of minority individuals; serving minority communities
MDIs typically serve minority communities through lending and additional resources, such as helping non-English speaking individuals. But MDIs aren’t limited to serving those in a minority group, allowing others to support their business model.
Find an updated list of MDIs that are supervised by the Office of the Comptroller of the Currency (OCC).
Alternatives to working capital business loans
Getting a loan for operational expenses may not be the best choice for every business. Other ways to cover your costs include:
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 36 percent APRs. Bankrate’s rate tables can help you find a competitive APR with terms that work for you.
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.
Your business will have to meet the grant’s qualifications and compete with many other businesses vying for the same funding. Qualifications may be highly specific, such as for minority-owned businesses or those in an industry.
Crowdfunding involves the business owner raising funds from personal contacts or crowdfunding platforms. Businesses can use different types of crowdfunding models, including donations that don’t need to be repaid. Some platforms like Kickstarter reward investors with small gifts or provide some equity in the project.
Peer-to-peer lending allows businesses to get loans from other individuals or businesses, typically through a platform. For example, Kiva is a microlender that blends elements of crowdfunding and peer-to-peer lending. Members can invite family and friends to contribute to a loan and then publicize their needs to be funded by other lenders.
Frequently asked questions about working capital loans
Working capital loan rates can range from 7 percent to 99 percent or higher, based on several factors like creditworthiness and annual revenue. Working capital business loans are short-term loans, which usually carry higher rates than long-term loans.
Yes, SBA loans can be used for many business-related needs. Several types of SBA loans are designed to help cover working capital, including SBA 7(a) loans, Express Loans and microloans.
Many lenders offer term loans and lines of credit that are available to business owners with bad credit. There are also several types of working capital loans designed to help business owners with bad credit. This includes invoice financing and merchant cash advances. But bad credit business loans come with high interest rates and short repayment terms. If you have time to wait, taking time to build credit can help make loans more affordable.
How we chose our best working capital business loan lenders
Bankrate's trusted small business loan industry expertise
To choose the best working capital business loans, we researched banks with fair eligibility requirements and programs. We then considered features that make loans affordable and accessible to businesses with different characteristics and needs, including interest rates, whether the loans are secured or unsecured, minimum annual revenue and fees. These lenders were also evaluated for notable qualities such as funding speed and nontraditional eligibility criteria.
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.
