Best Small Business Loans for Veterans

Many of the best small business loans for veterans offer specific discounts or pricing incentives for qualifying military service members. You may also find that these lenders also provide resources for growing your business, along with financing options that carry competitive rates and flexible qualifications for things like credit score, time in business, and business revenue.

Below, we’ve compiled a list of the best small business loans available to veterans:

• Grasshopper Bank: Best overall for businesses seeking significant support
• Navy Federal Credit Union: Best for veterans with various banking needs
• Bank of America: Best for veterans with a strong credit score and history
• Accion Opportunity Fund: Best for DEI-oriented business owners
• Lendio: Best for veteran business owners with bad credit
• National Funding: Best for short-term financing needs
• SBG Funding: Best for veterans needing quick access to capital
• Funding Circle: Best for low payment amounts
• Bluevine: Best for flexible access to funding

Best Small Business Loans for Veterans at a Glance

Grasshopper Bank: Best Overall for Businesses Seeking Significant Support

Why We Like Grasshopper Bank

Grasshopper Bank is our top overall pick because of its SBA 7(a) offering, a program designed to provide working capital for a wide range of business uses, low down payments, and competitive terms. While SBA loans can take a long period of time to get approved and funded, Grasshopper Bank is a preferred SBA lender, allowing it to make decisions on behalf of the SBA, something that can reduce the amount of time needed for you to get your funds.

Due to the minimum loan amount of $250,000, Grasshopper Bank is more suitable for businesses that have large financial needs. Common examples of allowable uses of loan proceeds include business acquisitions, equipment, inventory, business expansion, real estate financing, debt consolidation, working capital, and more.

If you’re interested in learning more, you can visit the Grasshopper Bank website to apply or find the contact information for its lending team. As a loan applicant, you can get pre-qualified with no impact to your credit score. Note however, this would not guarantee a loan approval, as the final decision requires a more thorough review of other third-party documentation that may come later in the process.

Navy Federal Credit Union: Best for Veterans With Various Banking Needs

Why We Like Navy Federal Credit Union

Navy Federal Credit Union is a lending institution that specializes in financing options for military service members, including veterans and their family members. You’ll need to be a member of the credit union to partake in its various banking services. Like Bank of America, it offers both personal and business banking services, which is useful if you’re looking to keep your finances in one place.

It offers various loan types, which can be used to purchase commercial real estate, obtain a business line of credit, or get term loans for working capital purposes. While qualification requirements are generally undisclosed on its website, there are a few general guidelines to consider. This includes collateral requirements, down payments, and fees where applicable.

As a credit union, it offers favorable rates and terms for small business loans, although you’ll have to consult the institution for more information pertaining to discounts and current interest rates. Once you’re a member, you can submit a loan application online.

Bank of America: Best for Veterans With a Strong Credit Score & History

Why We Like Bank of America

While not specific to veteran-owned businesses, Bank of America offers small business loans that can provide financing opportunities for businesses industry-wide. However, it offers a 25% discount on loan administration or origination fees for veterans applying for a new credit facility for their small businesses.

It also has competitive rates and is a suitable option for established businesses with a strong credit history. It offers both secured and unsecured business term loans and is an option for veteran-owned small businesses looking to obtain working capital and fund various business endeavors.

You may have to provide a personal guarantee depending on the loan type and meet higher qualification standards in comparison to other lenders in this guide. The application process can be lengthy, so if you’re looking for same-day disbursements (provided by lenders like SBG Funding), you may want to consider that before applying.

Notably, Bank of America is also a designated SBA loan provider, should you choose to go that route. Also, a perk unique to this guide is its rewards program offerings, which can provide discounts and perks to members who have a Bank of America business checking account and can meet monthly deposit account balance requirements.

Accion Opportunity Fund: Best for DEI-oriented Business Owners

Why We Like Accion Opportunity Fund

The Accion Opportunity Fund differs from most lending institutions included in this guide in that it operates as a non-profit. More specifically, it strives to provide funding opportunities to groups that otherwise may be overlooked, such as minorities, women, and veterans. As part of its non-profit lending model, loan repayment proceeds are utilized to invest in other small businesses.

What also sets it apart is its loan structure; it tailors each loan in consideration of a variety of factors—focusing more on cash flow and earning potential rather than just credit score or time in business. In addition to financing opportunities, it offers educational and business development resources to help business owners continue to grow and achieve their goals.

You can get a quote online with no impact on your credit score—you’ll just need to provide information on business revenue and expenses. The application process is simple and, if approved, you’ll be provided with a variety of offers for your ideal repayment schedule and interest rate. If it can’t extend an offer, it provides other resources and can direct you to another partner lender.

Lendio: Best for Veterans With Bad Credit

Why We Like Lendio

Lendio is unique on this list in that instead of offering its own lending products, it connects potential borrowers with various lending partners that can provide business financing opportunities. It caters to a wide variety of business owners and can present several loan options with one simple application.

With many partner lenders, there’s a better chance of approval depending on the qualification standards of the lender. This allows business owners with bad or limited credit histories the opportunity to shop around in one place and source financing for their business needs.

Eligibility criteria vary per lender; however, loans are generally attainable and offer differing terms and repayment options. Lendio utilizes funding specialists for each application to help borrowers understand the pros and cons of each lending option. This benefits businesses that are weighing their options; they can use the funding specialist as a resource to ensure the best fit for their business.

National Funding: Best for Veterans With Short-term Financing Needs

Why We Like National Funding

National Funding has experience supporting veteran business owners and offers various financing opportunities for their businesses. Its working capital loans have shorter repayment terms compared to term loans from traditional institutions like Bank of America or Navy Federal Credit Union.

So, if you’re an established business with short-term financing needs, this is a great option for quick access to working capital. Depending on your desired loan term, there are repayment periods anywhere from four to 16 months.

Loan proceeds are disbursed quickly upon approval and can be used to pay vendor invoices, cover emergency costs, purchase equipment, and finance a variety of other business expenses. National Funding also utilizes a factor rate, which is something to keep in mind when shopping around for loan terms. Notably, there’s no prepayment penalty attached to the provider’s small business loan. Rather, it offers an early repayment discount, which isn’t offered by other lenders on our list.

While there are no specific loan benefit offerings to veteran business owners, National Funding has experience working with veterans and offers additional business development resources. You can discuss all of your loan options by working with its designated funding specialists and applying online.

SBG Funding: Best for Veterans Needing Quick Access to Capital

Why We Like SBG Funding

SBG Funding is one of our top-recommended working capital loan providers. Among other lending options, it offers customized small business term loans that present a variety of financing opportunities to businesses industry-wide. Notably, it offers up to a $500 rebate in loan interest for veterans.

If you need quick access to capital, SBG Funding offers a streamlined application and approval process that requires little time and documentation. If approved, you can receive funds within the same business day. Loan proceeds can be used for a variety of business needs, including cash flow shortages, expansion, inventory, and access to emergency funds.

The loans are best suited for established businesses needing long-term financing with favorable rates and terms. However, the lender does review applications on a case-by-case basis, so it considers businesses with limited history if it has the resources.

SBG Funding is a great resource for sourcing financing for your business and has a simple online application that provides you with quick lending decisions and disbursements. Various qualification requirements depend on the loan details.

Funding Circle: Best for Low Payment Amounts

Why We Like Funding Circle

Compared to the other lenders we selected in our guide, Funding Circle has one of the lowest maximum funding amounts as well as the longest repayment term. This is a combination perfect for businesses that want to have lower monthly payments for cash flow purposes. Funds from a Funding Circle business loan can be used for nearly any business-related purpose. Common examples include payroll expenses, equipment, and renovation costs for buildings.

Funding Circle does not charge any application fees, and there are no obligations to accept a loan if you apply and get approved. Depending on your circumstances, you may have to pledge collateral to get financing, which can include personal or business assets. This collateral requirement is determined by the duration of your loan and the strength of your qualifications, such as your credit and finances.

One of the downsides of a Funding Circle small business term loan is the fact that it has one of the highest minimum credit score requirements in our guide. If you don’t qualify for a term loan however, the company does have other lending products that may be more suitable.

To learn more or apply, you can visit the Funding Circle website. There, you can get pre-qualified with no impact to your credit score, and a dedicated account manager can walk you through the process.

Bluevine: Best for Flexible Access to Funding

Why We Like Bluevine

If you want to have the flexibility of drawing funds at your own discretion without needing to apply for a new loan each time, a Bluevine small business line of credit could be a good fit. Coupled with a Bluevine business checking account, you’ll have instant access to funds you draw.

While other providers in our guide also offer small business credit lines, we selected Bluevine because of the combination of its rates and fees. In addition to having one of the lowest rates for a credit line, it also has no account setup fees, maintenance fees, long-term contracts, or termination fees.

With Bluevine, your small business line of credit can be repaid on either a weekly or monthly basis over a period of one year. Payment plans typically default to the weekly payment plan as the monthly plan has higher qualification requirements. This includes, but is not limited to, a higher credit score of 700, time in business of three years or more, $960,000 in annual business revenue, and an average monthly bank balance of $10,000.

You can visit the Bluevine website to apply or learn more. If you’re interested in applying, you can get a decision online in as little as five minutes with no impact to your credit score.

How We Evaluated the Best Small Business Loans for Veterans

We evaluated the small business loan providers for veterans based on a few key factors:

• Qualification criteria per lender
• Rates and terms of various loan options
• Maximum loan amounts available
• Benefits and resources provided to veterans
• Ease of application process
• Approval and disbursement timeline

Additional Resources for Veteran-owned Businesses

There are several resources to assist veterans with further financing opportunities. These include various initiatives that involve training programs, federal contracting programs, and other funding resources.

PenFed Foundation

The PenFed Foundation provides financial assistance via its Veteran Entrepreneur Investment Program, which allows scalable veteran-owned businesses the opportunity to offer equity stakes in their business in exchange for funding. Investors have the option to keep their ownership percentage or cash out their shares via a convertible note. Financing options are decided by the PenFed investment committee and are based on a presentation and business plan.

Learn more about the PenFed Foundation

Hivers & Strivers

Hivers & Strivers is an angel investment group that aims to support veteran-owned businesses. It provides angel funding in exchange for equity stakes and offers business guidance to help ensure a return on investment. To qualify, you must be a veteran-owned business with high potential and provide a business plan outlining your structure and growth projections.

Learn more about Hivers & Strivers

SBA Resources

• Military Reservist Economic Impact Disaster Loan (MREIDL): Eligible businesses can apply for this SBA loan if their business staffing has been impacted due to military service requirements. It provides up to $2 million in loan proceeds and can be used to cover operating expenses. Read our article about SBA disaster loans to learn more.
• Veteran Business Outreach Center (VBOC) Program: This program offers various resources to veterans, service members, and military spouses interested in starting or growing a small business. Such resources include business training, workshops, networks, counseling, and local mentorship opportunities.
• Boots to Business (B2B) Program: The B2B program is offered by the SBA and aims to provide educational and training opportunities pertaining to business ownership for potential military service entrepreneurs.
• Women Veteran Entrepreneurship Training Program (WVETP): This is considered a grant opportunity that provides educational and business development resources to women service members, spouses of service members, and veterans.
• Service-Disabled Veteran Entrepreneurship Program (SDVTEP): For veterans who were injured in the line of duty, SDVETP aims to provide funding opportunities to current veteran-owned businesses, or assistance to those who are potential business owners.
• Veteran Federal Procurement Entrepreneurship Training Program (VFPETP): VFPETP offers federal procurement training for currently involved or interested veteran-owned or service-disabled businesses.

Alternatives to Small Business Loans for Veterans

There are quite a few financing alternatives for veterans looking to get a small business loan.

• Startup business loans: Startup business loans are available to a wide variety of businesses with limited history and resources that need financing to get their businesses up and running. It’s best for those looking to finance long-term expenses that can be repaid with monthly installments for the term of the loan.
• Business credit cards: For flexible business expenses, you can use a business credit card to make purchases and pay off the balance over time. This is an option for business owners who have short-term expenses and can take advantage of flexible repayment terms. For options, see our top-recommended small business credit cards.
• Business line of credit: Similar to a credit card, a business line of credit acts as a revolving credit facility in which the user can request draws and then finance various expenses. The balance is expected to be repaid over time, and the funds can be drawn on an as-needed basis. Our roundup of the best small business lines of credit is a good place to start your search for a provider.
• Personal loans: If you’re ineligible for a small business loan, you can utilize personal loans to fund your business. This is an ideal option for businesses with bad or limited credit history since a personal loan is granted based on personal financials. To learn more, check out our guide on putting personal money into a business.

Frequently Asked Questions (FAQs)

What qualifications does a business need to be considered veteran-owned?

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What credit score do you need to qualify for a small business loan?

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Are there benefits to receiving a loan specifically for veterans?

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Bottom Line

The best business loans for veterans offer favorable rates and terms and can provide financial support to the operations of a business. Generally, loans offered apply to any small business; however, in consideration of the best loan offerings for veterans, they should also come with education or developmental resources specific to service members to help aid their business endeavors and set them up for success.