If you have bad credit (under 600) and can’t qualify for a working capital loan from your bank, there are a number of alternative options that might work. In fact, our pick for the best bad credit business loan, Fundbox, doesn’t even check your credit. We review the best bad credit business loans below.
Types of Bad Credit Business Loans
| Type | Best For |
|---|---|
| Fundbox | (Best overall) No credit check business loans. Funding up to $100K. |
| OnDeck | Businesses with at least 500 credit score and $100k+ revenues that need up to $500K fast. |
| Kabbage | Businesses with at least 550 credit score looking for monthly payments and up to $250K. |
| BlueVine | Businesses with at least 530 credit score that invoice customers and need a short-term cash flow fix. |
| LoanBuilder | Businesses with at least 550 credit score and $42k in revenue that need up to $500k. |
| Credibly | Business owners with poor credit that need their loan to be based on business revenues. Likely the most expensive option. |
How We Choose the Best Loans for Businesses with Bad Credit
When considering the best bad credit business loans we took the following things into consideration:
- Required credit score
- Maximum loan amounts
- Repayment terms
- Speed of funding
We also only considered lenders that we believe fund bad credit borrowers on a regular basis. Some lenders have set minimum qualifications that sound good, but they don’t approve a high percentage of applicants that meet those qualifications. If you don’t have a high chance of getting funded when you qualify then meeting their minimum qualifications doesn’t matter.
The right loan provider for you will vary based on your personal and business situation. All of the options in this article provide fast financing, and none of them require you to put up collateral in order to get funded.
After taking all of these things into consideration, we recommend Fundbox as the best overall bad credit business loan. They offer up to $100K of financing with no credit check, and they can fund you in as quick as 1 day.
Fundbox: Best No Credit Check Business Loan Provider
Fundbox offers a no credit check line of credit that you can draw against as you need funds, without having to reapply each time. Fundbox has 2 different lines of credit, one that qualifies you based on your company financials and another that funds you for your outstanding customer invoices. With both, you can get access to financing in as quick as 1 day.
Who Fundbox is Best For
Fundbox is the best loan option for bad credit borrowers with strong recent revenues and who only need up to $100K in financing. If your business has been consistently growing its revenues for the last 3-6 months at a minimum, then Fundbox could be a great source of quick financing to help with a short term need.
Fundbox Costs
The APR for a Fundbox credit line starts at 38% and there are no hidden fees. Unlike other loan options on this list, the quicker you pay off a Fundbox loan the cheaper it will be for you. There are no prepayment penalties and when you pay it off early and you can save on the total cost of capital by not paying interest and fees for the remaining weeks of your term.
Total costs for a Fundbox loan are calculated as an annual percentage rate (APR), which is:
- APR: 38 – 54%
Fundbox Terms
Fundbox lines of credit have repayment terms of 12 or 24 weeks and payments are made weekly. You can borrow up to $100K based on your recent business performance or the value of your unpaid customer invoices. Plus, Fundbox can typically have you funded within 1-3 business days.
General terms for a Fundbox line of credit are:
- Maximum Loan Amount: $100K
- Repayment Terms: 12 or 24 Weeks
- Repayment Cycle: Weekly
- Initial Approval Speed: 2-3 Hours
- Time to Funding: 1-3 Business Days
Fundbox Qualifications
There is no minimum credit score requirement with Fundbox because they don’t do a credit check, and you can qualify if you have been in business for at least 6 months. Fundbox will perform a custom-built business health assessment after you connect with your bank account. That assessment will determine your eligibility and how much you qualify for.
General qualifications for a Fundbox line of credit are:
- Credit Score: None
- Minimum Annual Revenue: No minimum
- Time in Business: 6+ Months
- Personal Guarantee Required: No
How to Apply for a Fundbox Loan
Fundbox has an online application that requests basic business information, and it can be filled out in just a few minutes. You’ll connect your business bank account to Fundbox and they’ll run their custom check to determine your eligibility within a few hours. If approved, you can be funded in as quick as 1 day.
OnDeck: Best For Bad Credit Business Loans up to $500K
OnDeck offers short term loans and line of credit products to small businesses of up to $500K with credit scores requirements as low as 500. They’re less focused on your personal credit score and more focused on your business’s recent revenues. Plus they can get you funded in as quick as 1 day.
Who OnDeck is Best For
OnDeck is the best poor credit business loan if you need more than $100K in financing quickly. While they perform a credit check, their minimum credit requirements are lower than any other comparable option besides Fundbox.
OnDeck Costs
The APR for OnDeck loans ranges from 30% to 50%. A small set of very creditworthy borrowers and repeat borrowers can qualify for better rates. You can read our OnDeck Review article to learn more about OnDeck costs.
Total costs for an Ondeck loan are calculated as an annual percentage rate (APR), which is:
- APR: 30 – 50%
OnDeck Terms
With an OnDeck loan, you can borrow up to $500K with repayment terms between 3 months and 3 years. Depending on your credit profile, you’ll be asked to repay your loan with either daily or weekly payments. OnDeck is a great short term solution for fast financing as well, with the ability to get you funded in as quick as 1 day.
General terms for an OnDeck Loan are:
- Maximum Loan Amount: $500K
- Repayment Terms: 3 Months – 3 Years
- Repayment Cycle: Daily or Weekly
- Initial Approval Speed: 10 Minutes
- Time to Funding: 1-3 Business Days
OnDeck Qualifications
OnDeck qualifications are more strict than Fundbox’s, but their credit score requirement of 500+ is the lowest of all lenders in this article who actually perform a credit check. If you have a high enough credit score, have been in business for at least 1 year, and have $100K+ revenues then you’ll meet the minimum qualifications for funding.
General qualifications for an OnDeck loan are:
- Credit Score: 500+ (check your credit score for free)
- Minimum Annual Revenue: $100K+
- Time in Business: 1+ Year
- Personal Guarantee Required: Yes
How to Apply for an OnDeck Loan
To apply for an OnDeck loan, you’ll fill out their online application which takes about 10 minutes. As part of that process, you’ll then connect your bank account to OnDeck who will verify your information and determine your eligibility. You’ll know if you qualify within 1 day and can get funded for up to $500K within 1-3 days.
Kabbage: Best Bad Credit Business Loans With Monthly Repayment Terms
Kabbage is a short term working capital lender that offers a business line of credit of up to $250K in as quick as 1-3 days if you have a 550+ credit score. With Kabbage, you don’t have to re-apply for financing each time you need more money. Instead, you just draw down from the total amount you’ve been approved for the next time you need funding.
Who Kabbage is Best For
Kabbage is the best option if you’re looking to repay your loan monthly instead of daily or weekly like OnDeck and Fundbox. It’s also a great option if you have a consistent cash flow need and would benefit from having a line of credit instead of a loan. It’s also great if you’re unsure of how much money you need and instead want access to a line of credit to draw from.
Kabbage Costs
Kabbage’s costs are calculated in APR, which includes all interest rates and fees. Their average APR is 40%, with a range between 30 – 50%. This includes a loan fee rate of 1.5 – 10% for the first half of your repayment period and a rate of 1% for the second half. You can read our Kabbage review to learn more about these costs.
Total costs for a Kabbage loan are calculated as an annual percentage rate (APR), which is:
- APR: 30 – 50%
Kabbage Terms
Kabbage offers up to $250K in funding with repayment terms of 6 or 12 months with a monthly repayment cycle. There are no prepayment penalties with a Kabbage loan so you can pay your loan off early and save on monthly fees outlined in the costs section above.
General terms for a Kabbage Loan are:
- Maximum Loan Amount: $250K
- Repayment Terms: 6 or 12 Months
- Repayment Cycle: Monthly
- Initial Approval Speed: 10 Minutes
- Time to Funding: 1-3 Business Days
Kabbage Qualifications
The minimum qualifications are a 550+ credit score, at least 1 year in business, and a minimum of $50K in annual business revenue. If you’re wanting to qualify for a loan amount close to their maximum then your credit profile will need to be significantly better than that.
General qualifications for a Kabbage loan are:
- Credit Score: 550+ (check your credit score for free)
- Minimum Annual Revenue: $50K+
- Time in Business: 1+ Year
- Personal Guarantee Required: Yes
How to Apply for a Kabbage Loan
Like OnDeck and Fundbox, Kabbage also has an online loan application which you can complete in about 10 minutes. You’ll link Kabbage to your business bank account where they can verify your information and determine your eligibility for a loan. Once approved, you can be funded for a credit line up to $250K in as quick as 1 business day.
BlueVine: Another Option for Poor Credit Business Loans
If you have outstanding customer invoices of $20K+ that are due in the next 90 days then you can finance them with BlueVine. The loan is paid back when your customers pay off the invoices. Your credit profile is less important than the creditworthiness of your customers and anyone with a 530+ credit score is considered. BlueVine also offers a line of credit product but you’ll need a 600+ credit score to qualify.
Who BlueVine is Best For
BlueVine is the right fit if you have a lot of unpaid B2C, B2B, or B2G invoices and need between $20K – $5 million in financing. Invoice factoring is great for small business owners who need to bridge gaps in cash flow to do things like make payroll or buy equipment.
BlueVine Costs
BlueVine charges 2.5 – 5% of the total financing amount per month with repayment terms between 1 – 12 weeks. BlueVine will advance you 85% of each invoice up front, and once the customer pays off the invoice they will pay you whatever remains after their fees are taken out.
Total costs for a BlueVine loan are calculated as an annual percentage rate (APR), which is:
- APR: 30 – 60%
BlueVine Terms
BlueVine will finance up to $5 million for well qualified borrowers, but typically won’t finance poor credit borrowers more than one funding event at a time. When your customers pay off your financed invoices you can finance more. You won’t have to make any payments on a BlueVine loan unless your customer fails to pay off the invoice in a timely manner.
General terms for a BlueVine Loan are:
- Maximum Loan Amount: $5 Million
- Repayment Terms: Up to 12 Weeks
- Repayment Cycle: No payments, paid in full within 12 weeks
- Initial Approval Speed: 10 Minutes
- Time to Funding: 1-3 Business Days
BlueVine Qualifications
BlueVine only requires a minimum 530 credit score, $10K+ in monthly revenue, and 3+ months of business history to qualify for invoice financing. If you want to finance much more than the $20K minimum, then you’ll need to have a stronger credit profile. You need to invoice creditworthy B2B, B2G, or B2C customers since they’ll be paying the invoice to pay off the loan.
General qualifications for a BlueVine loan are:
- Credit Score: 530+
- Minimum Annual Revenue: $10K+ per month
- Time in Business: 3+ Months
- Personal Guarantee Required: Yes
How to Apply for a BlueVine Loan
To apply for a BlueVine loan you’ll need to fill out an online application that can be completed in just a few minutes. You’ll then need to provide the invoices you want to finance to BlueVine so they can verify them and approve you. Your initial approval and funding on your first invoices can occur in as little as 1 day.
LoanBuilder: Best For Low-Revenue Business Loans up to $500K
LoanBuilder offers 13-52 week short-term loans of $5k-$500k and you only need $42k in annual revenue and a credit score of 550+ to qualify. While LoanBuilder requires personal guarantees on all loans, they primarily consider your business credit. You can get approved instantly and loans are funded as soon as the next day.
Who LoanBuilder is Best For
LoanBuilder is the best poor credit business loan if you need more than $250K in financing and earn less than $100k in business revenue. Although they perform a credit check and require a personal guarantee, their minimum loan eligibility requirements are lower than most other providers.
LoanBuilder Costs
The Total Interest Charge LoanBuilder loans includes the APR as well as additional loan fees and ranges from 25%-50%. You are required to pay the Total Interest Charge for your loan regardless of if you pay the loan back early.
Total costs for an LoanBuilder loan are expressed as a Total Interest Charge which is typically:
- Total Interest Charge: 25%-50%
LoanBuilder Terms
You can borrow up to $5k-$500k from LoanBuilder with repayment terms from 13-52 weeks. LoanBuilder automatically deducts loan payments weekly. You can pay off your loan early, but are still required to repay the Total Interest Charge. LoanBuilder is good provider of fast short-term business financing, with the ability to get instant approval and funding as quickly as the next day.
Terms for a LoanBuilder loan include:
- Maximum Loan Amount: $500K
- Repayment Terms: 13-52 Weeks
- Repayment Cycle: Weekly
- Initial Approval Speed: 5-10 Minutes
- Time to Funding: 1-3 Business Days
LoanBuilder Qualifications
Minimum qualifications for a LoanBuilder loan are among the lowest of short-term business loan providers. You must have a credit score of 550+, have been in business for at least 9 months, and have $42k+ in annual revenue.
The minimum qualifications for a LoanBuilder loan are:
- Credit Score: 550+ (check your credit score for free)
- Minimum Annual Revenue: $42k+
- Time in Business: 9+ Months
- Personal Guarantee Required: Yes
How to Apply for an LoanBuilder Loan
To apply for a LoanBuilder loan, fill out their online application that takes 5-10 minutes. As part of the application process, LoanBuilder will run a credit check and public records search to verify your information and determine your loan eligibility. You can find out instantly whether you qualify and can get your loan funded up to $500K within 1-3 days.
Credibly: Another Option for Bad Credit Borrowers
Credibly offers an expensive loan that is considered a merchant cash advance because they provide a lump sum of money based on your expected credit card receipts. Their aim is to simplify the loan process by limiting paperwork to decrease the time of a traditional loan application process, and make it easier for you to repay your loan.
Who Credibly is Best For
If you’re looking for simplicity in applying for and managing your loan then Credibly is a good choice. While the costs are expensive, a merchant cash advance from Credibly can help you solve a short term cash flow problem if you have strong recent credit card sales.
Once you’re approved, you won’t have to worry about the management of your loan because payments will come out of your credit card receipts automatically every day until it’s paid off, based on your daily deposits.
Credibly Costs
A loan from Credibly will likely be the most expensive option in this article. If costs are a concern, it’s probably a last resort. Their average factor rate is going to be 1.20, which means you’ll repay about 20% more than you borrow. There is also a one time 2.5% origination fee.
Total costs for a Credibly loan can be calculated as an annual percentage rate (APR), which is:
- APR: 80 – 120%
Credibly Terms
With Credibly, you can borrow up to $250K and their application process only takes about 10 minutes. Their repayment terms are 4 – 18 months with a required automatic payment daily. Credibly typically gets borrowers approved and fully funded within 48 hours.
General terms for a Credibly Loan are:
- Maximum Loan Amount: $250K
- Repayment Terms: 4 – 18 Months
- Repayment Cycle: Daily
- Initial Approval Speed: 10 Minutes
- Time to Funding: 2-5 Days
Credibly Qualifications
The minimum qualifications for a Credibly loan are $15K+ in monthly business revenue, and at least 6 months in business. Many merchant cash advance providers are based directly off of your credit or debit card receipts, but Credibly will include all of your revenue deposits in determining your eligibility.
General qualifications for a Credibly loan are:
- Credit Score: No minimum requirement, but they will check your credit.
- Minimum Annual Revenue: $15K+ per month
- Time in Business: 6+ Months
- Personal Guarantee Required: Yes
How to Apply for a Credibly Loan
A merchant cash advance from Credibly is easy to apply for. All you have to do is fill out an online application that takes less than 10 minutes. You’ll be asked for your most recent 3 months of bank statements and your most recent business tax return if you’re asking for a $100K+ loan.
Bad Credit Business Loans for Niche Borrowers
Some business loans that are available to bad credit borrowers have very specific requirements based on how you receive payments from your customers. For example, Square Capital and Paypal Working Capital both offer financing if you use their services to process payments, and neither one requires a credit check.
Square Capital
If you process payments with Square, you can get a loan up to $100K with Square Capital. You’ll pay up between 30 – 35% APR with repayment terms of up to 18 months, and there is no minimum credit requirement and no credit check. You can learn more by reading our Square Capital Review.
PayPal Working Capital
Likewise, if you process your customer payments through PayPal, you can leverage that partnership to get funded through PayPal Working Capital. You can borrow up to 30% of your annual PayPal sales with a maximum of $97,000 for your first loan. The APR is going to be between 15 – 35%, and they can get you funded within minutes. You can learn more by reading our Paypal Working Capital Review.
Bottom Line
Business owners with poor credit shouldn’t be discouraged if they are rejected for a traditional bank loan because there are a number of good options worth considering. Depending on what your personal and business situation is, you may find any of the options in this article a good fit to get financed quickly.
Our recommended bad credit business loan provider is Fundbox. They offer up to $100K of financing without requiring a credit check. Instead, your loan eligibility will be based solely on your recent business history. There’s also no minimum revenue requirement in order to qualify, and they’ll typically get you funded in as quick as 1 day.
Beatrice n nyoro
Do you lend to business people in other countries
Laura Handrick
Hi Beatrice,
Sorry, we do not lend money. We are an educational website that helps small businesses find resources and information they need.
Best!
Laura, staff writer
Sherry Wallace
Hi My name is Sherry Wallace and I am trying to get start up funds for my business. My credit score is over 600 but under 650. The only problem That I have are 3 or 4 companies that are in collections due to a divorce and 2 deaths in my family that I had to take care of. The accounts are over 1 or 2 years old. One of the accounts are over 6 months old but they did the charge off Aug 2016. It’s hard to find anyone to approve you with start up funds. Can you give me some in site on what I need to do and if Behalf can help me.
Ian Atkins
Hi Sherry,
Lenders of all kind will be very hesitant to lend money if there are accounts outstanding that are in collections, but here are a couple options:
1: Inventory financing: if you have a track reccord selling a product and the product is non perishable, then consider getting funding from Kickfurther.
2: Invoice financing: if you are B2B or B2G and invoice your clients, invoice financing with a company like Fundbox can extend lines based on outstanding invoices.
3. Short term alternative loans: a lender like Kabbage may be able to work with you.
You may want to consider working with a credit repair company like My Credit Group. Read our full buyers guide here to see why we think they are the best. Until your credit is cleaned up, any borrowing you do will be very expensive.
Regards,
Ian
Ken Dawson
I had a horrible experience with OnDeck. I have spent nearly 21 years in credit and collections with much of that time as a chief credit officer for the consumer lending group of a top 5 bank. I actually helped in the selection of the sample of accounts that my bank provided in the development in the latest FICO models, and I was given 35 seconds to talk with a “loan specialist”. This “loan specialist” actually disconnected the call while I was in mid-sentence because when he asked what my monthly gross revenue was, my response was $500/month too low. So, that ended our conversation. I tried calling back, but it was pointless. OnDeck doubled down on their shaky turn down, and somehow came up with a credit score for me for that day in a letter that followed that was 90 points lower than the Equifax site reported to me 10 minutes prior to my call to OnDeck. I do not trust their business practices. Others may feel differently, but they certainly did not give me a shot. And, they used incorrect information.
Ian Atkins
Hi Ken,
Sorry to hear you weren’t satisfied with your experience at OnDeck. My experience with alternative / online lenders is that they don’t have much in the way of wiggle room. You either meet their credit score / revenues / time in business requirements or you do not. In most cases, their underwriting team doesn’t have the options of looking at other factors that might make you an acceptable risk. OnDeck has very flexible credit score requirements but is compensates for that by having very strict revenue requirements. ($500/month = $6k/year). None of that excuses poor customer service or a rude salesperson.
Two places that have lower revenue requirements are Kabbage and Fundbox.
I hope you have better luck there. Feel free to email me directly if you have questions/concerns.
Best,
Ian
Dewayne
Where can you go to get Start-Up Capital to Purchase A Closed Business and Lease A Second With Option To Purchase After Three Years With Bad Credit Below 500 currently. These Two Will Net About 15,000 a month.
Priyanka Prakash
Hi Dewayne,
Thanks for your question. With a credit score under 500, it’s very difficult to get a loan to buy or lease a business. Your best bet may be to use retirement funds (if you have some saved up in a retirement account) or to borrow money from family and friends. Once you’ve owned the business for a few years, more options may open up to you. Also, by increasing your credit score, you can expand your financing options.
Best of luck!
Regards,
Priyanka
Mark Cooper
I think this article need to be updated to show that Behalf DOES run a personal credit check:
Behalf’s email reply to me after I applied for business funding / invoice financing:
Mark –
Thanks for contacting us at Behalf.
In response to your inquiry, because you created an account with us to seek to use our financing service for vendor purchases, we run a customer evaluation. << – (My words here – AKA ** Personal ** Credit Check )
Further information about this is disclosed in our Terms of Use, which you accepted when you opened your account with Behalf (https://www.behalf.com/terms):
10. Due Diligence
If you create or access an online account through this website you authorize Behalf to conduct background, onsite and financial examinations. You authorize Behalf to conduct background and financial examinations of you, which may include, but is not limited to, address verifications for up to ten (10) years; querying a commercial and consumer credit history and score from any credit bureau, searches of any and all relevant publically available information hosted on the world wide web; and a search for bankruptcies, liens or judgments in all jurisdictions where you have conducted business. You authorize Behalf, at its sole discretion, to report your personal and business credit to credit bureaus.
Thank you for your interest in Behalf.
Priyanka Prakash
Hi Mark,
Thanks for the information! I have updated the article to clarify that Behalf does conduct a credit check. Based on my research, they do not have a specified minimum, at least not one that they disclose publicly. They also check other factors, such as online and social media data, in deciding whether to approve a business for a loan.
Best,
Priyanka