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Best Small Business Loans For Bad Credit

Need a business loan, but you have bad credit? Getting a loan isn't as unlikely as you think! All of these lenders offer solutions for businesses with bad credit.

    Shannon Vissers
  • Last updated onUpdated

  • Erica Seppala
  • REVIEWED BY

    Erica Seppala

    Editor & Senior Staff Writer

Our content reflects the editorial opinions of our experts. While our site makes money through referral partnerships, we only partner with companies that meet our standards for quality, as outlined in our independent rating and scoring system.

When you have a bad credit score of 600 or lower, getting a business loan with fair terms and affordable fees can be difficult. If you’re in the “bad credit” boat, you might think getting affordable financing for your business is impossible. Fortunately, that’s not always the case.

Many lenders are beginning to look at other business factors to judge your business’s creditworthiness, even for first-time business loans with bad credit. While most still pull your credit score to verify your identity (and for additional reasons), you will find that high credit scores are not always necessary to qualify for business financing.

The following lenders (and honorable mentions) offer solutions for how to get a business loan with bad credit to those that might not qualify for the products of other lenders.

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  • Offers: Business loan matchmaking services
  • FICO: N/A
  • APR: Not disclosed
  • Offers: Business loan matchmaking services
  • FICO: N/A
  • APR: Not disclosed

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  • Offers: Business credit card & cash advances
  • FICO: N/A
  • Factor rate: 1.1-1.5
  • Offers: Business credit card & cash advances
  • FICO: N/A
  • Factor rate: 1.1-1.5

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  • Offers: Lines of credit
  • FICO: 600+
  • APR: 4.66%+
  • Offers: Lines of credit
  • FICO: 600+
  • APR: 4.66%+

Apply Now

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  • Offers: Business loan matchmaking services
  • FICO: 500+
  • APR: 3%+
  • Offers: Business loan matchmaking services
  • FICO: 500+
  • APR: 3%+

Apply Now

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  • Offers: STL, MCA, invoice factoring, equipment financing & more
  • FICO: 500+
  • Factor Rate: 1.11+
  • Offers: STL, MCA, invoice factoring, equipment financing & more
  • FICO: 500+
  • Factor Rate: 1.11+

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Read more below to learn why we chose these options.

Best Business Loans For Bad Credit

Even with bad credit, you can still get approved for a small business loan. Various online lenders offer bad credit business loans for working capital. You’ll have to pay more for the loan than someone with good credit, but many lenders will still lend to your business—as long you earn enough to make your payments.

Here are the five best small business loans for bad credit.

  • BusinessLoans.com: Best For No Credit Score Requirement
  • Revenued: Best Business Credit Card With No Credit Check
  • Fundbox: Best LOC For Bad Credit
  • Lendio: Best For Bad Credit Business Loan Options
  • Credibly: Best Working Capital Loan For Bad Credit

How The Best Small Business Loans For Bad Credit Compare

Min. Credit ScoreMin. Annual Revenue Max. Loan AmountTime In Business
BusinessLoans.comN/A$100K$3 million6 months
RevenuedN/A$180K$1 million6 months
Fundbox600$100K$150K6 months
Lendio500$50K$10 million6 months
Credibly500$180K$600K6 months

BusinessLoans.com: Best For No Credit Score Requirement

BusinessLoans.com

Total Rating 4.0
Rates & Fees4.6

Services4.0

Eligibility Requirements4.1

Application3.0

Sales & Advertising Transparency3.6

Customer Service4.1

User Reviews4.4



Pros

  • No minimum credit score required
  • A variety of bad credit loan types are available
  • Available in all 50 states
  • Funding amounts as large as $3 million

Cons

  • Minimal fee information disclosed on the website
  • Fees may be high
  • Not all loan options accept bad credit

Why We Chose BusinessLoans.com For No Credit Score Requirement

BusinessLoans.com is an online lending marketplace with multiple types of business loans available to businesses with bad credit via the free service's network of partnered lenders. Some of these loan types include short-term loans (STL), merchant cash advances (MCA), lines of credit (LOC), invoice factoring, equipment financing, and others.

Importantly, BusinessLoans.com does not require any minimum credit score to apply. Different lenders in its network may have different qualifications they desire in applicants, but BusinessLoans.com will try to find you with a matching offer, even if your credit is bad.

BusinessLoans.com Rates & Fees

BusinessLoans.com does not disclose much information about rates and fees on its website. However, BusinessLoans.com does estimate that payback fees on MCAs will equal 20% to 40% of the total advance amount (typical for an MCA).

BusinessLoans.com Eligibility Requirements

Business loan requirements for loans obtained through BusinessLoans.com vary, but the following requirements apply generally:

Time In Business 6 months
Business Revenue $100,000 per year
Personal Credit Score N/A

 

When To Use BusinessLoans.com

  • You want to explore multiple business financing options
  • You have at least 6 months in business and $100K in annual revenues

Get Started With BusinessLoans.com

Read our in-depth review

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Revenued: Best Business Credit Card With No Credit Check

Total Rating 3.7
Rates & Fees2.5

Services3.4

Eligibility Requirements4.0

Application4.8

Sales & Advertising Transparency3.8

Customer Service4.3

User Reviews4.9



Pros

  • No minimum FICO score or hard credit check
  • No monthly or annual fee
  • No interest charges on purchases
  • MCA option with fast funding

Cons

  • Cannot carry a balance
  • Cash advances have high factor rates
  • It doesn’t help you build credit
  • No rewards offered

Why We Chose Revenued For Businesses With Bad Credit

Revenued is one of the only business credit cards with no minimum FICO but still offers rewards. In fact, Revenued does not conduct any hard credit checks at any point during the application or approval process. Instead, approvals and borrowing limits are based on your business revenue.

Revenued also allows cardholders to withdraw cash advances against their credit line. These no-credit-check business loans can have high factor rates, but they are still in line with industry standards,

Revenued Rates & Fees

You will not incur any fees when using the Revenued business credit card since you cannot carry a balance. For cash advances, Revenued charges customers using a factor rate model, with factor rates ranging from 1.1-1.5.

Revenued Eligibility Requirements

Applicants should meet the following minimum criteria:

Time In Business 6 months
Business Revenue $15,000 per month
Personal Credit Score N/A

 

When To Use Revenued

  • You need a business charge card or merchant cash advance that doesn’t require a credit check
  • You have at least 6 months in business and $180K in annual revenues

Get Started With Revenued

Read our in-depth review

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Fundbox: Best LOC For Bad Credit

Total Rating 3.8
Rates & Fees3.1

Services3.6

Eligibility Requirements4.5

Application4.8

Sales & Advertising Transparency3.8

Customer Service3.0

User Reviews4.4



Pros

  • Get approval decision in as little as three minutes
  • Access funds as soon as the next business day
  • Apply and draw funds from Fundbox mobile app

Cons

  • Small credit limits ($150K or less)
  • Must repay the loan quickly (12 or 24 weeks)
  • Doesn’t accept very bad credit

Why We Chose Fundbox Loans For Best Line Of Credit

Fundbox offers an easy-to-use business line of credit that is not backed by specific collateral, even with bad credit. Fundbox uses algorithms to gain a holistic view of your business and make quick lending decisions. Most applicants will be able to fill out their applications, learn about their eligibility in a few minutes, and start drawing funds immediately.

Fundbox also made our list of the best unsecured business loans.

Fundbox Rates & Fees

Fundbox rates start at 4.66% for 12-week terms and 8.99% for 24-week terms. Fees are paid automatically every week.

Fundbox Eligibility Requirements

Before you apply to Fundbox, first make sure you meet the following minimum qualifications:

Time In Business 6 months
Business Revenue $100,000 per year
Personal Credit Score 600

When To Use Fundbox

  • You want a fast, easy business line of credit you can draw from as needed
  • You have a credit score of at least 600, 6 months in business, and $100K in annual revenues

Get Started With Fundbox

Read our in-depth review

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Lendio: Best For Bad Credit Business Loan Options

Total Rating 4.8
Rates & Fees5.0

Services5.0

Eligibility Requirements4.9

Application4.5

Sales & Advertising Transparency4.4

Customer Service4.9

User Reviews4.9



Pros

  • Free service
  • Saves time by sending your application to multiple lenders at once
  • Easy to qualify for funding
  • Large lender network with a variety of loan types available

Cons

  • Not all lenders are bad-credit friendly
  • Not for brand-new businesses that aren’t making money yet
  • Time-to-funding can be long

Why We Chose Lendio For Comparing Bad Credit Business Loan Options

Lendio is not actually a lender. It's an online loan marketplace you can use to search and apply for business loans of all types, including short-term loans, medium-term loans, lines of credit, and merchant cash advances, among others. Lendio has a vast lender network that includes lenders that accept applicants with bad credit.

Lendio's free service lets you prequalify for and compare multiple loan offers so that you can select the best one. Lendio saves you time and ensures you secure a fairly priced loan, even with bad credit.

Lendio Rates & Fees

Interest rates on loans available through Lendio’s partnered lenders can be as low as 3% for certain types of financing, such as accounts receivable financing. Your offer rate will depend on which type of loan you’re applying for (and how bad your credit score is). Lendio does not charge borrowers any additional fees to use the service.

Lendio Eligibility Requirements

Depending on which type of loan you apply for, Lendio’s borrower requirements vary. For example, some of Lendio’s financing options only require a credit score as low as 500. For other loan types, however, you’ll need to have a score in the high 600s.

The company recommends that you at least meet the following minimum requirements:

Time In Business 6 months
Business Revenue $50,000 per year
Personal Credit Score 500

 

When To Use Lendio

  • You want to explore multiple business financing options
  • You have a credit score of at least 500, 6 months in business, and $50K in annual revenues

Get Started With Lendio

Read our in-depth review

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Credibly: Best Working Capital Loan For Bad Credit

Total Rating 3.6
Rates & Fees3.1

Services3.7

Eligibility Requirements3.3

Application4.0

Sales & Advertising Transparency3.6

Customer Service4.3

User Reviews4.0



Pros

  • Same-day funding options
  • Discount for early repayment
  • Loans as large as $600K
  • Term lengths as long as 24 months

Cons

  • Time-to-funding may be longer than advertised
  • Not available in every state
  • Borrowing fees can be high
  • High revenue requirement

Why We Like Credibly For Working Capital Loans

Credibly offers short-term working capital loans for bad credit, as well as equipment financing and invoice factoring for businesses with poor credit. Lines of credit, SBA loans, and business expansion loans are also available, though these require slightly better credit.

Credibly's loans are not available in every state, so make sure Credibly serves your state before applying.

Credibly has a relatively easy online application process and good customer service. Credibly advertises same-day funding and a 4-hour approval time. However, some users say that the application process and/or time-to-funding took longer than expected.

Credibly Rates & Fees

Credibly’s factor rates for STL, MCA, equipment financing, and invoice factoring start at 1.11.

These rates are not cheap, but they are in line with industry standards.

Credibly Borrower Requirements

To qualify for a working capital loan or merchant cash advance, make sure you meet the following minimum borrower requirements before applying:

Time In Business 6 months
Business Revenue $180K/year
Personal Credit Score 500

 

When To Use Credibly

  • You need a short-term loan, invoice factoring, or equipment financing
  • You have a credit score of at least 500, 6 months in business, and $180K in annual revenues

Get Started With Credibly

Read our in-depth review

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Business Loan & Funding Products Review Methodology

We spend hours researching and evaluating each business loan and funding product that we review at Merchant Maverick, placing special emphasis on key characteristics to generate our ratings.

Weighted Rating Breakdown

Rates & Fees 20%
Services 20%
Eligibility Requirements 20%
Application 15%
Sales & Advertising Transparency 10%
Customer Service 10%
User Reviews 5%

When rating lenders and funding providers, we use a 31-point rubric that looks at rates and fees, services, eligibility requirements, application, sales and advertising transparency, customer service, and user reviews. We weigh each section differently to calculate the total star rating. This rubric is applied to traditional term loans, as well as short-term loans, start-up loans, lines of credit, online lending products, merchant cash advances, and equipment financing products.

  • Rates & Fees: 20% of the total star rating
  • Services: 20% of the total star rating
  • Eligibility Requirements: 20% of the total star rating
  • Application: 15% of the total star rating
  • Sales & Advertising Transparency: 10% of the total star rating
  • Customer Support: 5% of the total star rating
  • User Reviews: 5% of the total star rating

Each section is further broken down into granular, weighted subsections, in which we examine specific attributes like terms lengths, conditions of repayment, credit score and revenue requirements, ease of application, length of time to funding, the ethics involved in promoting the lending product, customer support, and the overall reputation of the lender or funding provider.

Read more about how we rate small business lenders.

Best Types Of Business Loans For Bad Credit

To improve your chances of getting a loan despite bad credit, look for types of business loans that don’t place as much emphasis on credit during the application and review process.

Types of loans for bad credit you might want to consider include:

  • Online Loans: Also called “alternative lenders,” online lenders place less importance on credit scores because they examine non-traditional risk metrics.
  • Microloans: Microloans feature small borrowing amounts and short-to-medium business loan repayment terms. Microloans are considered low-risk because loan amounts are small, so poor credit isn’t always a barrier to funding.
  • Invoice Financing: Invoice financing is a type of loan in which you put up your unpaid invoices as collateral in exchange for immediate financing. Because invoice financing is dependent on your customers paying their invoices, not you, your credit is not an important consideration.
  • Crowdfunding: Although crowdfunding can be significantly more work than other types of business financing, your credit score isn’t usually a consideration. Instead, backers decide to contribute to your fund based on your business plan’s strength, a desire to contribute to a business in a particular community, or other factors. Even startups with bad credit can even potentially secure funds with crowdfunding.
  • Business Credit Cards: You won’t qualify for the best credit cards if you have bad credit, but many issuers still offer credit cards for businesses with low scores. In addition to granting you access to cash, credit cards will help you build your credit up to get better financing down the line.

How To Get A Business Loan With Bad Credit

Wondering how to get a business loan with bad credit, or if it is even possible to get a business loan with bad credit?

It is absolutely possible to get a business loan even with subprime credit. Finding a business loan when you have poor credit does present an extra challenge—you’ll need to have strong income and limit your search to lenders that don’t require good credit— but you’ll still follow the same basic steps to securing financing as someone with good credit.

Read our post on how to get a business loan for a step-by-step guide to getting funded.

More Resources For Business Loans & Bad Credit

Finding business loans is still possible even if you have bad credit.

Low credit score business loans can enable businesses to purchase needed inventory and equipment or cover payroll during slow seasons. Though a traditional bank requires a good credit score to qualify for a loan, many online lenders will be willing to lend to you even if your credit isn’t anything to brag about. Just make sure that you look over the loan terms before accepting an offer because many short-term lenders have unfavorable terms.

Finally, a credit card is another option to consider as an alternative to a loan. If you have business expenses you can pay for with a credit card and don’t necessarily need liquid cash, you should read about the best credit cards for bad credit to explore your best options.

FAQs: Best Small Business Loans For Bad Credit

What credit score do I need to get a business loan?

You will usually need a score of at least 500 to secure a business loan, such as a short-term loan or line of credit.

Some online lenders do not have any stated minimum credit score requirements. However, they will usually pull your credit and verify your personal and business information to look for any red flags that indicate you won’t be able to repay your loan.

How much do bad credit business loans cost?

Business loans for poor credit are not cheap. You could end up paying as much as 50% of your loan amount or more in fees. The amount you will have to pay will depend on your business income, time in business, which lender you choose, the size and term length of your loan, and other factors.

Lenders often have loan calculators on their websites to help you get a rough idea of what your fees could be.

Are there any resources to help me get a bad credit business loan?

If you have not been able to qualify for a business loan on your own due to bad credit, it is a good idea to check if any local business associations are offering low-interest loans to struggling small businesses in your region. Local Community Development Financial Institutions can offer CDFI business loans or connect you to resources that can help.

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Shannon Vissers

Shannon Vissers

Lead Staff Writer at Merchant Maverick
Shannon has been writing for Merchant Maverick about small business software and financing since 2015. She started writing professionally about business topics in 2005. Shannon has been featured in the Washington Post, Reader's Digest, US News, MSN, Yahoo Finance, Business Insider, and other publications. She has a bachelor's degree in English from San Diego State University and currently resides in San Diego, California.
Shannon Vissers
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