Interest rates on unsecured business loans can range anywhere from 7 percent to 99 percent, depending on the type of loan you choose, the lender and your business’s credit profile. It’s possible to get low interest rates on an unsecured business loan, such as 8 percent to 10 percent, if your business has good credit.

But lenders typically offer higher rates for unsecured versus secured business loans since unsecured loans aren’t backed by collateral. These loans pose a higher risk to lenders because they can’t immediately seize business assets to repay the loan in case of default.

Below, you’ll find current interest rates for different unsecured business loans and what to look for when comparing loans.

Compare current interest rates for unsecured business loans

Get an idea of the interest rates you’ll find based on the type of unsecured loan and lender.

Loan type Average rates
Term loans
  • Bank: from 7.00% to 7.99%+
  • Online lender: 9.00% to 75.00%
Business lines of credit
  • Bank: 7.50% to 19.00%
  • Online lender: 5.00% to 50.00%
Business credit cards
  • 14.00% to 28.00%
SBA loans
  • Fixed rate: 13.25% to 16.25%
  • Variable rate: 10.50% to 13.00%
Invoice factoring
  • 0.50% to 4.00% factoring fee
Merchant cash advances
  • Factor rate: 1.3 to 1.5
  • Interest rate: 30.00% to 99.00%

Unsecured term loans

Some unsecured term loans come with either a low loan amount or short repayment terms to offset the risk of not having business assets tied to the loan.

Since features differ among lenders, compare rates and terms that these lenders set for their term loans.

Lender Interest rates Details
Bank of America 6.75%+
  • Loan amounts from $10,000
  • 1- to 2-year terms
  • $150 origination fee
Fora Financial 1.15 to 1.40 factor rate
  • Loan amounts from $5,000 to $1.4 million
  • Terms up to 16 months
  • Eligible for additional funding after 60% repaid
National Funding 1.10+ factor rate
  • Loan amounts from $5,000 to $500,000
  • 4- to 24-month terms
  • 1% to 3% origination fee
  • 600 min. credit score
PNC Bank Not disclosed
  • Loan amounts from $20,000 to $100,000
  • 2- to 5-year terms
  • 1% origination fee
Triton Capital 8.99% to 74.99%
  • Loan amounts from $10,000 to $250,000
  • 3- to 36-month terms
  • 1% to 2.5% origination fee
U.S. Bank From 7.99%
  • Loan amounts up to $50,000
  • Terms up to 7 years

Unsecured business lines of credit

A business line of credit provides a way for businesses to access funding as expenses crop up. The lender sets a credit limit based on the business’s ability to repay, and the business repays any amounts drawn within a set repayment term like one to two years.

Some banks will set a lower maximum credit limit like $100,000 for unsecured lines compared to secured lines. Take a look at what traditional banks and online lenders offer for this type of unsecured loan.

Lender Interest rates Details
Bank of America From 9.25%
  • Credit limits from $10,000
  • Renews annually
  • No draw fees
Bluevine From 6.20%
  • Credit limit up to $250,000
  • 6- to 12-month repayment term
Credibly From 4.80%
  • Credit limit up to $300,000
  • Offered through lending partners
  • May pay an origination fee
Fundbox 4.66% to 8.99% amortized weekly fee
  • Credit limit from $1,000 to $150,000
  • 12- to 24-week terms
  • Accessible to fair credit borrowers
Lendio 8.00% to 24.00%
  • Credit limits from $1,000 to $500,000
  • 1- to 2-year terms
  • Works well for startups and bad credit borrowers
PNC 9.83% to 19.44%
  • Credit limits from $20,000 to $100,000
  • $175 annual fee
Wells Fargo 10.00% to 18.00%
  • Credit limits from $5,000 to $150,000
  • SBA line of credit option
  • Annual fee on BusinessLine line of credit

Business credit cards

Business credit cards offer a solid option for smaller purchases while letting the business owner earn rewards.

Fair and bad credit borrowers can find credit-building options, though most unsecured business credit cards need a strong credit score of 670 or higher.

Credit card Interest rates Details
Ink Business Cash® Credit Card 17.99% to 23.99% variable
  • 1% to 5% cashback rewards
  • 0% APR for first 12 months
  • No annual fee
Capital One® Spark® Cash Plus for Business N/A
  • Charge card
  • 2% to 5% cashback rewards
  • $150 annual fee
Brex 30 Card N/A
  • Charge card
  • 7X to 8X points on certain purchases
  • No annual fee
  • Pay off daily for highest rewards rate
Capital One Spark 1% Classic 28.49% variable
  • 1% to 5% cashback rewards
  • No annual fee
  • Works well for business owners with fair credit
Divvy Business Card N/A
  • Charge card
  • 1X to 7X rewards on certain purchases
  • No annual fee
  • Pay off weekly for highest rewards

Invoice factoring

Invoice factoring is an alternative type of business financing that doesn’t require collateral because it’s guaranteed by the business’s future invoices. Instead of interest, factoring companies charge a fee on the entire outstanding invoice amount.

The fee structure may include a time window, such as invoices getting paid within 30 days, before the fees are raised or reassessed.

Lender Interest rates Details
Credibly 1.11 factor rate
  • Loans up to $400,000
  • Advances up to 90% of invoice amounts
Lendio 3.00% fee
  • Advance up to 90% of unpaid invoices
  • Terms up to 1 year
  • Works through partner lenders
SMB Compass From 12.00%
  • Loan amounts from $25,000 to $10 million
  • 6- to 24-month terms
  • Funds in as little as 24 hours

Merchant cash advances

Merchant cash advances (MCAs) allow your business to get funding based on future credit card sales. Most MCAs assess a factor rate instead of an interest rate, which gets multiplied up front by the entire amount borrowed.

MCAs are a high-risk type of loan that businesses use if they can’t get funding through a conventional business loan. That’s because merchant cash advances have high approval rates as long as your business has adequate sales volume.

Lender Interest rates Details
Credibly 1.11 factor rate
  • Loans up to $400,000
  • 3- to 18-month terms
  • $50 administrative fee
  • 2.5% underwriting fee
Lendio From 18.00%
  • Loans from $5,000 to $2 million
  • Terms up to 2 years
  • Funds in as little as 24 hours
Fora Financial 1.15 to 1.40
  • Loans from $5,000 to $1.5 million
  • Funds within 24 to 72 hours

Factors that influence unsecured business loan rates

The exact interest rates you’re given for an unsecured business loan are influenced by:


You’re more likely to get lower interest rates with a traditional bank than with an online lender. But underwriting may take longer since the bank may need extra time and documentation to verify that your business can repay the loan.

Traditional banks also tend to work with businesses with a top-notch credit history, such as a score of 670 or higher.

Type of loan

Business lines of credit and term loans offer some of the lowest rates available for unsecured loans, provided you have good credit.

If you go with a business credit card, the starting rates are higher than some business loans. Credit card APRs might be lower than or on par with other loans if you have less-than-perfect credit, especially if the card has a 0 percent APR offer.

Credit score and payment history

The lowest rates are reserved for businesses with good credit, such as a score of 670+. In general, lenders keep tighter requirements for unsecured loans than secured loans to ensure that the loan gets repaid.

Otherwise, you might have to go with a bad credit business loan, which charges higher rates and fees.


Your business’s financial statements play a large role in any business loan, but especially an unsecured loan. Lenders will want to see adequate cash flow and low debt, such as a debt-to-income ratio of less than 36 percent.

Lenders may also use the debt service coverage ratio to see how much revenue your business generates above debt repayments.

How to compare unsecured business loans

Comparing unsecured business loans is similar to comparing business loans generally. But a few features may be different for unsecured loans:

  • Interest rate. If you were to apply for a secured and unsecured business loan, you’d probably get lower interest rates on the secured loan. That’s because the lender has a guarantee that some or all of the loan will get repaid, even if you default.
  • Factor rate. Some unsecured loans charge factor rates instead of interest rates. These can translate into high borrowing costs because they’re applied to risky types of loans and don’t incorporate additional loan fees. You’ll need to convert the factor rate to an interest rate to see how the loan compares.
  • Loan amount. Some lenders lower the maximum loan amount available for unsecured loans compared to their secured loan options. This is especially true for traditional banks.
  • Repayment terms. Compare the length of repayments you’ll be making, such as six months, as well as the repayment schedule. Some alternative or short-term loans like merchant cash advances require daily or weekly repayments.
  • Additional fees. Additional business loan fees will vary by the type of loan and lender, so make sure you read the loan agreement to understand what you’ll be paying. For example, some lenders charge an origination fee to review the loan application. Business lines of credit may charge a draw fee when you withdraw money from your credit line.

Bottom line

Interest rates vary widely in the market for unsecured business loans because there are different types of unsecured loans available. In general, your business should see a higher rate for this loan than if you borrowed the same amount but backed the loan with assets. When choosing a loan, consider the loan that offers the best interest rates and terms to match your business’s qualifications.

Frequently asked questions

  • A business loan can affect your personal credit report, but not always. Many lenders perform a hard credit check against your personal credit when applying for a business loan, especially if you don’t have a lengthy business credit history. Business loans may also affect your personal credit if you personally guarantee the loan, are a sole proprietor or you fund or back the loan with personal assets.
  • Not necessarily. The interest rates for small business loans are determined by the business’s creditworthiness. Small businesses with low revenue or lack of credit history will probably get matched with a higher rate than large businesses with established revenue.
  • Many lenders offer unsecured business loans with interest rates between 7 percent and 19 percent. But interest rates can reach as high as 75 percent to 99 percent for some borrowers. A good interest rate is the lowest rate that you can find for your business’s credit profile.