Uber & Lyft Financing: 7 Ways to Fund Your Rideshare Business

Uber is our choice as the best provider for flexible car rental terms because it allows its drivers to rent vehicles on an hourly basis. There are no long-term commitments, and its minimum rental period is shorter than other providers we considered.

Regardless of how frequently you drive for Uber, you should find a rental option that fits your needs. Its flexible terms allow you to rent a vehicle to drive from as little as a few hours to as long as two months or more. There are no mileage restrictions—and insurance, roadside assistance, and basic maintenance are included.

Rental rates can be as low as $260 per week. The company also provides estimates for how much you can earn based on your location. For example, Uber currently estimates that you could earn $872 per week driving for 40 hours in the Dallas-Fort Worth, Texas, area.

Uber’s vehicle partners include Avis, Hertz, Kinto, and Getaround. Each has its own selection of vehicles you can choose from, and qualification requirements that can vary. For example, the minimum age to rent can be 21 or 25, depending on the rental company you select. Some partners may also require a security deposit equal to the estimated rental charges plus $200.

One downside is that it can take up to 10 days or more to get approved as a new Uber driver. The approval process requires a background check that includes a review of your driving record and criminal history.

With Lyft Express Drive, you could get rental rates as low as $219 per week. That’s lower than many other providers we reviewed, making it a good option if you’re looking to save money.

Lyft has partnered with Hertz and Flexdrive to provide its rideshare drivers the option to rent a car. Other than a minimum rental period of one week, there are no long-term commitments. All rentals include basic maintenance, insurance, roadside assistance, and unlimited mileage. To qualify, you must be 25 years old.

To get approved as a driver for Lyft, you’ll need to agree to a background check of your driving record and criminal history. Certain locations may have additional requirements for minimum driving experience. In total, it can take two to 10 days for the background checks to be completed before you can start driving.

One thing Lyft does differently than some other companies is that it deducts your rental fees from your earnings. If your weekly earnings aren’t sufficient to cover the rental charges, they’ll be charged to the payment method you designate. A refundable deposit is also required for all rentals through Lyft, which is returned to you no later than three weeks after you give back the rental vehicle.

A downside of Lyft Express Drive is its limited availability. Currently, the program is only available in approximately 40-plus cities in the US.

HyreCar is our pick for rideshare drivers who don’t intend on driving long distances. This is because some of its features have daily limits, such as mileage and towing distance. However, it has easy qualification requirements and competitive rental rates, so it’s still an excellent provider to consider.

Car rental options on HyreCar consist of vehicles owned by individuals and businesses. Each can set some of its own terms, such as daily mileage restrictions that range from 250 to 1,000 miles per day. Regardless of the mileage, towing is limited to 30 miles from the vehicle pickup/drop-off location.

Vehicles listed on HyreCar have already been approved by Uber and/or Lyft, so you don’t have to file any additional paperwork to get approval to use those vehicles. However, you’ll still need to undergo a separate background check from HyreCar. This process typically takes around 48 hours.

HyreCar has a minimum rental age of 21 and is available in all 50 states. You must have at least three months of driving experience, although the requirement increases to one year if you are below the age of 25.

Kabbage is our recommendation for businesses with low revenue because it requires just $36,000 annually to qualify. Other providers can require as much as $100,000 or more, making it difficult to get approved if you aren’t a full-time rideshare driver. Other requirements to qualify include a credit score of 640 and at least 12 months’ time in business.

Kabbage Funding’s line of credit allows you to draw funds on an as-needed basis. This can be useful to cover unexpected expenses or emergencies, such as car repairs and maintenance. You can get a line of credit for up to $150,000 with repayment terms of six, 12, or 18 months:

• Six-month loans: Monthly fees from 2% to 9%
• 12-month loans: Monthly fees from 7.5% to 18%
• 18-month loans: Monthly fees from 15.75% and 27%

One downside of this provider is that once you draw funds from the line of credit, it can take one to three days to get access to it. However, the application process is quick and can be completed in 10 minutes or less.

We chose Lendio as the best provider for multiple loan options because of its network of more than 75-plus lenders. It’s a good choice if you don’t want to spend time submitting applications with different lenders or if you’re having trouble getting approved with other providers.

When you apply with Lendio, you can work with a loan specialist to find a loan best suited for your needs. Qualification requirements can vary depending on the type of loan you choose but, generally, you’ll need a credit score of at least 560 and six months’ time in business. It’s also recommended to have annual revenue of at least $50,000.

If you’re a rideshare driver, Lendio offers term loans and lines of credit that you may find helpful. However, it also offers other types of loans, including Small Business Administration (SBA) loans, business cash advances, and equipment financing.

You can complete an online application in as soon as 15 minutes, and approvals and funding can occur within 24 hours.

If you have strong credit and are looking to purchase your own vehicle for Uber or Lyft, LightStream is our pick as the best personal loan for business purposes. It offers rates as low as 5.99% and can finance new or used vehicles.

LightStream’s auto loans have terms ranging from two to 12 years. It charges no prepayment penalties, so you can pay off your loan more quickly to save on interest charges—or stretch your payments over a longer period to reduce your minimum monthly payment.

Loan amounts anywhere from $5,000 to $100,000 are available. To qualify, you’ll need a credit score of 660. There is no minimum time in business requirement, and the amount of income you need will vary based on your other debt payments and loan amount you’re applying for.

Getting a loan with the provider is a quick process. Applications can be completed in 10 minutes, and it can review your application and issue a loan decision within 24 hours.

The Chase Ink Business Cash® card is a good choice to pay for everyday expenses, such as food and gas, and it also earned a spot on our list of the best fuel cards for small businesses. As a cash back rewards credit card, you can use this to reduce the cost of running your rideshare business effectively.

For each account anniversary year, you can earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable, and phone services and 2% cash back on the first $25,000 spent at gas stations and restaurants. All other purchases will earn 1%.

Rewards earned on the card are issued in the form of Chase Ultimate Rewards® points. While the points can be redeemed for cash back, it’s possible to get even more value from your points by redeeming them for other items, such as hotels or airline tickets.

The card also offers travel and purchase coverages. When you use the card, you can extend the manufacturer’s warranty by an additional year on eligible warranties of three years or fewer. Additionally, purchase protection is available to cover qualifying items for 120 days against damage or theft up to $10,000 per claim.

You can also get primary rental car insurance (collision damage waiver) if you travel and rent a car for business purposes, which can eliminate the need to file a claim with your own insurance company.

As a rideshare business, acquiring a vehicle is just one of many types of expenses. To avoid any surprises, here are a few other costs you should consider:

• Auto loan or rental fees
• Meals (including drinks/snacks for passengers)
• Fuel
• Phone service
• Car repairs and maintenance
• Auto insurance premiums with rideshare add-on
• Roadside assistance
• Car wash/detailing services

To get a small business loan, you’ll need to check the eligibility requirements and make sure you qualify. This can vary depending on the type of loan and the lender. However, lenders commonly look at the following:

• Credit score: If you have a credit score above 680, you should have an easy time getting approved. However, you’ll still have plenty of loan options with bad credit.
• Revenue: Some lenders have a minimum requirement for annual business revenue. This is often used to determine your ability to repay the loan.
• Down payment: Certain loans will require a minimum down payment as a condition of issuing loan proceeds. This is common for new car loans and can commonly range from 10% to 20%.
• Time in business: Startups have a high failure rate, so lenders consider startup businesses with less than two years’ history to be higher risk. Loans are available for startups but may carry higher rates and fees.