Key takeaways

  • You may be able to receive fast business loan funds within a few hours
  • A fast business loan can be used for a variety of purposes, such as emergencies, cash shortfalls, disaster funding and more
  • Many fast business loans have high interest rates and cost more compared to other business lending options

If you own a business, you’ve probably found yourself in situations where you could use some extra cash. Many types of business loans exist, including fast business loans designed specifically to put cash in your bank account within days.

These loans prioritize speed over other factors, such as low cost or high limits. You can use them in many ways, but they’re intended for a few specific purposes.

Types of fast business loans

There are many different types of fast business loans available. Each works slightly differently and is best suited for different scenarios.

Type of  fast loan Description Best for
Term loans Loans that offer a lump sum upfront followed by regular payments.
  • Emergencies
  • Seasonal borrowing
  • Time-sensitive opportunities
Business lines of credit Offers flexible access to cash. You can draw from the line of credit multiple times and only pay interest on your outstanding balance.
  • Cash shortfalls
  • Emergencies
  • Seasonal borrowing
  • Unplanned expenses
  • Time-sensitive opportunities
Business credit cards Flexible access to cash and the ability to make purchases in stores. No interest if you don’t carry a balance. May offer perks and rewards.
  • Short-term financing
  • Emergencies
  • Cash shortfalls
  • Unplanned expenses
Equipment financing Loans used specifically for the purchase of equipment and machinery.
  • Equipment purchases
SBA Express loans Government-insured loans with high limits and easier qualification requirements.
  • Cash shortfalls
  • Seasonal borrowing
SBA disaster loans Government-insured loans offered to borrowers located in declared disaster areas.
  • Disaster recovery
Merchant cash advances Small loans intended for working capital or inventory purchased. Repayment is made automatically through a percentage of your future sales.
  • Emergencies
  • Cash shortfalls
Invoice finance/factoring Financing based on your company’s outstanding invoices. Typically, you’ll get a percentage of your invoiced amounts without waiting for customers to pay.
  • Cash shortfalls

6 ways you can use fast business loans

Fast small business loans have many uses, from helping you handle an emergency to allowing you to take advantage of an opportunity. When you consider taking out a loan, make sure you’re using the right one for the job.

1. Emergencies

Any business can face a financial emergency. Whether it’s a company car breaking down and needing repairs or some supplies or inventory spoiling and needing to be replaced, if you don’t have an emergency fund, you’ll need another way to recover from the emergency.

Some of the best business lines of credit and term loans offer fast turnaround times for funding, which allows you to get the cash you need to deal with an emergency expense.

Best type of loans to cover emergencies

  • Term loans
  • Business lines of credit
  • Business credit cards

2. Cash shortfalls

Even profitable businesses can run into cash shortfalls if their cash flows don’t line up properly. Even if you have money coming in, you might struggle to pay the bills if there’s nothing in your bank account.

Using a fast business loan to cover a shortfall can help you avoid defaulting on a payment to a supplier, missing payroll, or other issues. SBA loans and some business lines of credit provide affordable business financing. But SBA loans take weeks to provide funds, and business lines of credit tend to have lower loan amounts than term loans.

If you can’t qualify for fast business term loans or low-interest lines of credit, invoice financing or factoring and merchant cash advances are viable options to help you. But these options will cost a lot more, especially if you can’t pay them off quickly.

Best type of loans to cover cash shortfalls

  • SBA Express loans
  • Business line of credit
  • Merchant cash advance
  • Invoice factoring/financing

3. Seasonal borrowing

Some businesses are seasonal, having some months where business booms and others where things slow down. Financing can help these companies make it through the slow months so they can get back to the boom times.

Planning for slowdowns is important to help make sure you have the funds you need. If you know you’ll need financing to make it through a slow period, applying for a loan, like an SBA Express loan, ahead of time can make it easier to qualify.

A business credit card could be the best option, depending on how much you need to borrow. These usually come with free employee cards, discounts and other business perks. Loan amounts are typically smaller than business loans, but if you don’t have excellent credit, rates can be much more affordable than many other types of business financing as long as you pay on time and pay your debt off as soon as possible. You can also build business credit as long as you pay your balance on time and keep your debt low.

Best type of loans to cover seasonal borrowing

  • Term loans
  • Business line of credit
  • SBA Express loans
  • Business credit cards

4. Unplanned expenses

Every business faces unplanned expenses. You might forget about a bill that’s coming due or need to pay a few hundred dollars to repair a piece of equipment quickly.

Having a revolving line of credit can give you peace of mind when unplanned expenses happen. But merchant cash advances, invoice financing and invoice factoring are good options if you have bad credit and don’t have cash on hand.

Best type of loans to cover unplanned expenses

  • Business lines of credit
  • Business credit cards
  • Merchant cash advances
  • Invoice financing and factoring

5. Disaster recovery

Disasters can happen to anyone. Whether it’s an earthquake, hurricane, major storm, flood, civil unrest or other catastrophic events, rebuilding your business can be difficult and expensive.

The Small Business Administration offers a special disaster loan program to companies in declared disaster areas. They’re available to businesses in addition to private nonprofits, homeowners and renters and offer low interest rates. They often have faster approval and funding timelines than an SBA Express loan, with funding possible in as little as two or three weeks.

There are a few types of disaster recovery loans, each for a different purpose. For example, physical damage loans help repair or replace damaged property. Mitigation assistance can pay operating expenses. Economic Injury loans offer economic relief to business owners.

Best type of loans to cover disaster recovery

  • SBA disaster loan
  • Term loans
  • Business lines of credit

6. Time-sensitive opportunities

If you’re fortunate, your business might encounter exciting growth opportunities. It could be a new location that’s up for rent if you can put down a deposit today or a piece of equipment that’s on sale.

Whatever it is, having the cash to take advantage of these opportunities quickly can be a boon for your company. If you don’t have the funds on hand, you can use fast loans to get the money you need.

Best type of loans to cover time-sensitive opportunities

  • Term loans
  • Business lines of credit
  • Business credit cards

Pros and cons of fast small business loans

Fast business loans can help you get money quickly, but consider both the advantages and disadvantages before applying.

Pros

  • Quick approval and funding. Fast business loans offer short approval processes and quick funding. Often, you can apply for a loan, get approved in minutes and see money in your account the next business day.
  • Easier qualification. Many fast lenders, especially online lenders or those offering alternative financing like invoice factoring, have lower eligibility requirements than typical lenders. That can make them an option for borrowers with bad or fair credit.
  • Flexibility. Some fast loans, especially lines of credit and credit cards, offer flexibility. You can draw funds multiple times and on an as-needed basis, making them a useful tool to have in your business owner toolkit.

Cons

  • High costs. Many fast business loans carry high interest rates and fees, making them an expensive way to borrow money. You can often find a better alternative if you’re not pressed for time.
  • Low limits. Fast business loans prioritize speed rather than the ability to borrow large amounts. You’ll be limited in the amount you can borrow, which means that you might not be able to afford large expenses with a fast loan.
  • Short terms with frequent payments. Most fast business loans have short repayment terms, often two years or less. Many lenders also ask for frequent payments, such as weekly or biweekly payments, rather than monthly.

Bottom line

Fast small business loans have many uses, making them a great way for business owners who need cash to get funds quickly. Before you apply, make sure you’re using the right loan for the job and shop around with several lenders to find the best fast business loan for your business.

Frequently asked questions

  • Fast business loans are often funded within 24 to 48 hours. Since these loans are often offered by online lenders with automated underwriting systems, you may even be approved the same day and have your money within hours. 
  • You can use an emergency business loan for many different purposes, such as making sure you have enough working capital, paying for unplanned expenses, buying inventory, or fixing equipment damaged by a disaster.
  • SBA loans involve a lot of paperwork and bureaucracy, so approval can take some time. For SBA approval, 7(a) loans have a turnaround time of five to 10 days. An Express loan has a shorter approval timeline of 36 hours, but it still takes time for the lender to finalize the loan and deposit funds into your account. While most SBA loans can take 45 to 90 days to receive funds, disaster loans can take two or three weeks to approve and five days to receive funds after closing on the loan.