Small Business Loans

Small business loans can help launch your startup, cover overhead costs, purchase equipment, refinance debt — and more. Here, you can compare business loan rates, calculate costs and explore your options to find the right loan for you.

Our featured picks

There’s no one-size-fits-all small business loan. That’s why we constantly evaluate lenders and show you a variety of options to help you choose the best business loan based on your needs. Here’s a look at our current top recommendations.

Credibly: Best for bad credit business loans

What to know: Some loan types are available to people with minimum credit scores of over 500 and only 6 months’ time in business. Equipment financing has no minimum credit score or annual revenue requirements to qualify. Loans have short repayment periods, though, and factor rates could lead to incredibly high loan costs.

Business credit score: Over 500 (Specific requirements vary)
Personal guarantee requirement: Yes
Time in business: Six months
Business annual income: $180,000

Read our full Credibly business loans review.

Wells Fargo: Best for lines of credit

What to know: Three revolving business lines of credit offer some of the lowest rates around and earn rewards on eligible purchases. New and established businesses may be eligible for the unsecured lines of credit, while the secured Prime Line of Credit is for businesses with at least $2 million in annual sales. Annual fees may apply (waived the first year).

Business credit score: 680
Personal guarantee requirement: Yes
Time in business: Varies (Two years for the BusinessLine line of credit and less than two years for the Business Advantage line of credit)
Business annual income: Not disclosed

Read our full Wells Fargo business loans review.

Funding Circle: Best for fast and affordable loans

What to know: Business term and SBA loans have more favorable rates compared to other online lenders. Loans may be approved and funded in as little as 24 hours, and you won’t have to deal with excessive fees, though the origination fee is high. Eligibility requirements are fairly strict, especially for SBA 7(a) loans, which have a minimum annual revenue of at least $400,000.

Business credit score: 660 (SBA 7(a) loans only require 630 credit score)
Personal guarantee requirement: Yes
Time in business: Two years
Business annual income: $50,000 for term loan

Read our full Funding Circle business loans review.

Learn more about small business loans

According to the Federal Reserve’s 2022 Small Business Credit Survey:

A business loan or line of credit was the most sought after source of financing.

The majority of business owners applied for business loans, SBA loans and SBA lines of credit.

Business owners with a personal credit score over 720 (low risk) were more likely to apply with a large or small bank over other types of lenders.

Finance companies and small banks had higher approval rates compared to online lenders and large banks.

The two biggest challenges applicants faced with online lenders were high business loan interest rates and unfavorable repayment terms.

The two biggest challenges applicants faced with large and small banks were difficult application process and long wait for credit decision and funding.
A business loan can help small business owners in a variety of ways, including starting or growing a business and covering day-to-day operational costs. But there are a number of advantages and disadvantages that you’ll have to consider to see if it’s right for you. For more information, check out:

Pros and cons of a business bank loan

Pros and cons of SBA loans

Pros and cons of bad credit business loans

Pros and cons of alternative business lending
Business loans are easy to get if you have excellent credit. But rising interest rates and the recent bank crisis have led to a tightening of credit. This makes it harder for some businesses to get loans, especially business owners with bad credit.

Alternative online lenders tend to have relaxed eligibility requirements, but you will find higher rates and fees and lower loan amounts compared to business loans from traditional banks and credit unions. Our guide on how to get a business loan can walk you through the basics. And for specific guidance based on your business situation, check out:

How to get a startup business loan

How to get a business loan with bad credit

How to get an LLC loan
This depends on your needs and current business situation. The right type of business loan can come down to factors like how long you’ve been in business, how quickly you need funds or how much time you need to pay back the loan. Some business loans are better suited for startups or business owners with bad credit, while others will appeal to established businesses with a long and successful track record.
Some business loans can be used to cover just about any business-related expense. Other business loans are for specific purposes. For example, equipment financing only covers business-related equipment like restaurant ovens, construction machinery or semi trucks.

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