A small business loan can get you access to capital for starting, expanding or keeping your business up and running.
But with so many types of businesses out there, there's no one-size-fits-all funding solution.
CNBC Select reviewed more than 30 lenders on a range of features, including minimum and maximum loan amounts, loan term and credit score needed. (Read our methodology for more on how we made our selections.)
Best for bad credit: Credibly
Who's this for? Borrowers with poor credit will want to check out Credibly, which only requires an FICO Score of 500 for approval.
Standout benefits: Borrowers can prequalify for a loan in just a few minutes. Credibly also offers funding in under 24 hours.
Offers many types of loans including long-term loans, working capital loans, business line of credit and merchant cash advance
- Approval within four hours
- Low minimum credit score
- Loan amounts of up to $600,000
- Funds deposited as soon as the same business day
- Considers overall business health for approval
- Requires average monthly revenue of at least $15,000
Best for larger loans: Fora
Who's this for? Fora Financial lets borrowers apply for as much as $1.5 million, more than any other lender on this list.
Standout benefits: Borrowers can increase the loan amount after paying back at least 60% of the principal.
Offers many types of loans including small business loans and revenue advance
- Higher loan limits than competitors
- Accepts lower credit scores
- Approval and funding in 24 to 48 hours
- Can increase loan amount after paying back at least 60%
- Prepayment discount
- Short loan term of just 15 months
Best for microloans: Kiva
Who's this for? If you're just dipping your toe in entrepreneurship, Kiva offers no-interest, no-fee microloans for as little as $1,000 or as much as $15,000. Kiva's network of individual and business partners get first crack at funding and then you can crowdfund with friends, family and followers.
Standout benefits: There's no credit score requirement or collateral required.
Loans are geared toward borrowers, especially business owners, who are unbanked and have trouble qualifying for financial products.
- 0% interest and no fees
- No minimum time in business or annual revenue required
- No credit score requirement
- Can reach community of 1.6 million Kiva lenders
- Low lending limit
- Personal guarantee required
- Borrowers need to crowdfund from their network
Best for same-day funding: OnDeck
Who's this for? OnDeck offers same-day funding for term loans as large as $100,000, depending on the state.
Standout benefits: OnDeck' only requires applicants to be in business for a year, making it accessible for newer businesses.
Potential for same-day funding for term loans up to $100,000
- Potential for same-day funding for term loans up to $100,000
- Low minimum credit score
- Fixed monthly payments
- Doesn't lend in Nevada, North Dakota or South Dakota
- Early payment fee if you don't qualify for prepayment benefit
Best for multiple loan types: Biz2Credit
Who's this for? Biz2Credit offers a few different types of financing options for your business: term loans, revenue-based financing and commercial real estate loans.
Standout benefits: This lender provides a variety of fixed-payment schedules, including daily, weekly and bi-monthly.
We like Biz2Credit's easy application process and high loan caps. And it charges simple, not compound interest, which can mean big savings for term loans. But the steep approval requirements make it a bad fit for startups with modest sales or in business for less than six months. In addition, Biz2Credit paid $33 million in 2024 after the FTC alleged it misled businesses about processing times for Covid-era Paycheck Protection Program (PPP) loans.
- Up to $6 million available for revenue-based financing
- Funds available as little as 24 hours
- Discount available if you link your business checking account
- Offers commercial real estate loans
- Need 12 months in business and $250,000 in annual sales
- $25,000 lending minimum may be too high
- Financing requires collateral or a personal guaranty
- Fee structure not publicly listed
Best for Square users: Square
Who's this for? Business owners already using Square should consider the company's loans. Square lets you repay by deducting money from your daily sales, which you might find more convenient.
Standout benefits: You can apply for as little as $100. Low borrowing amounts make Square appealing to those who just need a few hundred dollars.
We like that there's no credit check or personal guarantee requirement, as well as how quickly Square can deliver funding. But Square Loans are invitation-only and the upfront fee can higher than the interest on a traditional business loan. Also, if your daily sales don't cover the minimum payment, Square may debit the remaining balance from your linked bank account. That can be burdensome for businesses with small margins.
- Charges a flat upfront fee rather than interest
- No credit check or personal guarantee requirement
- Same-day funding available if you have a Square Checking account
- Must be invited to apply
- Factor rate can be higher than APY on traditional business loan
- if daily sales don’t cover minimum due, the remainder may be debited from linked bank account
Types of small business loans
There are a variety of loan options that suit different business needs. Here's an overview of nine types of small business loans:
Term loans
Term loans are one of the most common types of small business loans and are a lump sum of cash that you repay over a fixed term. The monthly payments will typically be fixed and include interest on top of the principal balance. You have the flexibility to use a term loan for a variety of needs, such as everyday expenses and equipment.
Revenue-based financing
Unlike a term loan, revenue-based financing doesn't have a set monthly payment. After an initial cash infusion from a financing company or equity firm, the business turns over a predetermined percentage of its monthly revenue until the investment is repaid
SBA loans
Small Business Administration (SBA) loans are enticing for business owners who want a low-cost government-backed loan. However, SBA loans are notorious for a long application process that can delay when you will receive the funding. It can take up to three months to get approved and receive the loan. If you don't need money fast and want to benefit from lower interest rates and fees, SBA loans can be a good option.
Business lines of credit
Similar to a credit card, business lines of credit provide borrowers with a revolving credit limit that you can generally access through a checking account. You can spend up to the maximum credit limit, repay it, then withdraw more money. These options are great if you're not sure of the exact amount of money you'll need since you only incur interest charges on the amount you withdraw. That's compared to a term loan that requires you to pay interest on the entire loan — whether you use part or all of it. Many business lines of credit are unsecured, which means you don't need any collateral.
Equipment loans
If you need to finance large equipment purchases, but don't have the capital, an equipment loan is something to consider. These loans are designed to help you pay for expensive machinery, vehicles or equipment that retains value, such as computers or furniture. In most cases, the equipment you purchase will be used as collateral in case you can't repay the loan.
Invoice factoring and invoice financing
Business owners who struggle to receive on-time payments may want to choose invoice factoring or invoice financing (aka accounts receivable financing). Through invoice factoring, you can sell unpaid invoices to a lender and receive a percentage of the invoice value upfront. With invoice financing, you can use unpaid invoices as collateral to get an advance on the amount you're owed. The main difference between the two is that factoring gives the company buying your invoices control over collecting payments, while financing still requires you to collect payments so you can repay the amount borrowed.
Commercial real estate loans
Commercial real estate loans (aka commercial mortgages) can help you finance new or existing property, like an office, warehouse or retail space. These loans act like term loans and may allow you to purchase a new commercial property, expand a location or refinance an existing loan.
Microloans
Microloans are small loans that can provide you with $50,000 or less in funding. Since the loan amounts are relatively low, these loans can be a good option for new businesses or those that don't need a lot of cash. Many microloans are offered through nonprofits or the government, like the SBA, though you may need to put up collateral (like business equipment, real estate or personal assets) to qualify for these loans.
Merchant cash advances
Like traditional cash advances, merchant cash advances come at a high cost. This type of cash advance requires you to borrow against your future sales. In exchange for a lump sum of cash, you'll repay it with either a portion of your daily credit card sales or through weekly transfers from your bank account. While you can often quickly obtain a merchant cash advance, the high interest rates make this type of loan a big risk. Unlike invoice financing/factoring, merchant cash advances use credit card sales as collateral, instead of unpaid invoices.
Franchise loans
Becoming a franchisee can help you achieve your goal of business ownership quicker and easier than starting from the ground up, though you'll still need capital. Franchise loans can provide you with the money to pay the upfront fee for opening a franchise, so you can get up and running. While you're the one taking out the loan through a lender, some franchisors may offer funding to new franchisees.
What do I need to apply for a small business loan?
When you go to apply for a small business loan, you'll need to have both personal and business information handy. Expect to enter some or all of the following information:
- Personal information (like your name and address)
- Tax identification number (which is either your employer identification number (EIN) or social security number (SSN), and sometimes both)
- Business name
- Business address and phone number
- Industry type and company structure
- Years in business
- Number of employees
- Annual business revenue
- Estimated monthly spend
During the application process, you may need to submit documentation, like your business plan, financial statements, bank statements and tax returns. There's also a good chance that your personal credit score will be pulled, so a lender can gauge your creditworthiness.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
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1.00% APY on balances of $0.01—$24,999.99 and $250,000.01; up to 1.35% APY on balances of $25,000-$250,000
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None using the base version; Found Plus* subscribers earn 1.50% APY on balances up to $20K.
Small business loan FAQs
What credit score is required for a small business loan?
You typically need at least a fair/average credit score (580 to 669) to qualify for a small business loan, but it will vary depending on the lenders.
If your personal credit score is good/very good (670 to 799) or excellent (800 to 850), you’ll have even better odds. As with most financial products, the higher your credit score, the better interest rates and fees you’ll receive.
Lenders focus on your personal credit score when setting minimum credit score requirements, however, they may also check your business credit score. But lenders don't state any requirements for business credit scores.
Am I personally liable for a small business loan?
In most cases, you, as the business owner, are personally liable for a business loan. When you take out a business loan, you’ll typically need to put up collateral, which can range from business property and vehicles to personal assets like your own car or home. In the unfortunate event that your business goes bankrupt and you can't repay your loan, you may also lose personal assets.
Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every small business loan review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of loan products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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Our methodology
To determine which lenders are the best for small business loans, CNBC Select analyzed more than 30 online and brick-and-mortar lenders.
We narrowed the field by only considering lenders offering term loans, equipment loans, commercial real estate loans, microloans, franchise loans and revenue-based financing.
We compared each small business loan on a range of features, including minimum and maximum loan amounts, term lengths, credit score and revenue requirements, the application process, availability of customer support, its Better Business Bureau rating and customer reviews.
We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.
Based on those criteria, our picks for the best small business loans are:
- For bad credit: Credibly
- For same-day funding: OnDeck
- For multiple loan types: Biz2Credit
- For microloans: Kiva
- For large loans: Fora Financial
- For Square users: Square
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