Featured Partner Offers
Loan amounts
$5,000 to $250,000
Best Low-Interest Business Loans
BEST FOR A LENDER COMPARISON SITE
Lendio
Editor’s Take
Lendio is an online business loan marketplace that connects prospective borrowers with traditional banks and nonbank online lenders. By filling out one application, business owners are able to connect to over 75 lenders. Over its existence, Lendio has helped small business owners receive over $12 billion in funding nationwide.
Applicants may see Lendio as a one-stop shop. You can apply for business loans, lines of credit, SBA loans, equipment financing, merchant cash advances (MCAs), commercial mortgages, invoice factoring and business acquisition loans. However, because Lendio is a marketplace and not a lender, it doesn’t publish specific terms. Instead, you’ll have access to its lending partners, and it will help you find the best offer for your specific needs.
Pros & Cons
One application connects you to more than 75 lenders
Wide variety of loan products, including term loans, lines of credit and SBA loans
Some lenders charge prepayment penalties
Terms and funding times vary depending on specific lender
Details
Overview
Lendio is an online business loan marketplace that connects prospective borrowers with traditional banks and nonbank online lenders. Over its existence, Lendio has helped small business owners receive over $12 billion in funding nationwide.
Applicants may see Lendio as a one-stop shop. You can apply for business loans, lines of credit, SBA loans, equipment financing, merchant cash advances (MCAs), commercial mortgages, invoice factoring and business acquisition loans. However, because Lendio is a marketplace and not a lender, it doesn’t publish specific terms. Instead, you’ll have access to its lending partners while helping you find the best offer for your needs.
Eligibility
Minimum Credit Score: 560
Time in Business: Six Months
Minimum Annual Revenue: $50,000
Funding time
Applying through Lendio takes 15 minutes. After you review your offers and are approved by your lender, you can receive your funds in as little as 24 hours.
BEST FOR QUICK APPROVALS
Fundbox
APR range
Interest rates start at 4.66%
Interest rates start at 4.66%
Editor’s Take
Fundbox is an AI-powered business lending platform that speeds up the application, decision-making and funding process. It offers decisions within three minutes and funds as soon as the next business day.
Prospective borrowers have two business financing options through Fundbox. Business owners can apply for revolving business lines of credit up to $150,000 with repayment terms of 12 or 24 weeks. Your available credit goes back up as you repay your line of credit.
Pros & Cons
No prepayment penalty
Low minimum annual revenue requirement
Next-business-day funding
Only short-term repayment terms are available
Does not disclose APRs
Details
Eligibility
Minimum credit score: 600
Time in business: Six months
Minimum revenue: $100,000 per year
Turnaround time
With a business line of credit from Fundbox, you can receive your funds as soon as the next business day.
The approval process is quick and Fundbox is available for the credit-challenged business. Credit approvals are usually small, so this [typically] isn’t an option for larger purchases. I had a small business client that had Fundbox integrated with her Stripe dashboard, which made it convenient.
— Herman Thompson, Jr., advisory board member
BEST FOR ESTABLISHED BUSINESSES
Funding Circle
Learn More
From participating partners via businessloans.com’s website.
Editor’s Take
Funding Circle has been a direct lender specializing in small business loans since 2010. Since its inception, it has helped 130,000 businesses in 700 industries and lent $19.4 billion globally. We chose Funding Circle because it provides fast, affordable loans with a simple application process and funding in as little as 48 hours. Prospective borrowers have three options: business term loan, line of credit or SBA loan.
Funding Circle term loans range from $25,000 to $500,000 with repayment terms from six months to five years. If you choose to apply for a business line of credit, you can access credit lines between $6,000 and $100,000. However, Funding Circle doesn’t specify its line of credit repayment terms. You can also apply for Funding Circle SBA loans, which range from $25,000 to $500,000 with terms up to 10 years.
There is one main drawback of Funding Circle: there’s a one-time origination fee on each loan ranging from 3.49% to 6.99% of the approved loan amount.
Pros & Cons
Loans from $25,000 to $500,000
Funding in as little as 48 hours
No minimum annual revenue requirement for most loans
One-time origination fee between 3.49% to 6.99% of the approved loan amount
Requires two years in business, so it’s not ideal for startups
Not available to Nevada businesses
Details
Eligibility
Minimum credit score: 660 for most loans; 650 for SBA loans
Time in business: Two years
Minimum revenue: None for most loans; $400,000 per year for SBA loans
Turnaround time
Depending on the loan type, you can receive your funds within two days. However, SBA loan funding may take up to two weeks.
Funding Circle provides long-term loans that are essential for businesses planning significant investments in growth or infrastructure. The clear terms and lower interest rates compared to short-term loans make this an excellent choice for businesses with a stable financial outlook and a strategic long-term development plan.
— Cache Merrill, founder and CTO, Zibtek
BEST FOR SBA LOANS
SmartBiz
Editor’s Take
SmartBiz is an AI-lending platform that connects business owners with U.S. Small Business Administration (SBA) loans, term loans and flexible financing options. SBA loans of up to $5 million and term loans of up to $500,000 are available.
When you apply for a loan through SmartBiz Loans, you may receive several offers from different lenders within its network to help you find the lowest interest rate or best terms.
Pros & Cons
Offers prequalification
Competitive interest rates
Good customer reviews
Requires business lien and personal guarantee
Stringent qualification requirements
Details
Eligibility: SmartBiz requires a minimum personal credit score of 650 to qualify for a business term loan, 650 for an SBA 7(a) loan and 675 for a commercial real estate loan. Businesses must have at least two years of history to qualify for an SBA or business term loan.
Turnaround time: SmartBiz does not disclose its turnaround times. However, it may take between 3 days to several weeks to receive your funds, depending on your loan type.
BEST FOR FLEXIBLE QUALIFICATION REQUIREMENTS
Accion
Minimum Credit Score
Accion does not disclose this information
Accion does not disclose this information
Editor’s Take
We picked Accion because it offers business loans from $5,000 to $100,000 with flexible qualification requirements.
For example, to qualify for an Accion loan, your business only needs to be at least three months old. If approved, you’ll have the option to choose from loans with different repayment terms, monthly payments and interest rate options. If Accion can’t approve you for a loan, it will refer you to its partner lenders or provide other resources.
Accion also provides one-on-one business coaching, mentoring opportunities and leadership training programs in both English and Spanish.
Pros & Cons
Loans range from $5,000 to $100,000
Terms customized to your needs
ITIN-only borrowers can qualify
Can’t be used to start a business
Not available in all states
Funding can take a couple of weeks
Details
Eligibility: Accion does not disclose a minimum credit score. However, it looks at more than just your credit score when evaluating your loan application, including your business revenue, expenses and other factors to determine your business’s viability. Unlike most small business loans, Accion only requires you to be in business for at least three months.
Turnaround time: An Accion customer service rep confirmed that it takes one to two business days to review your documentation, up to one week to receive an answer, another two days to get your loan agreement and up to four days to get the funds. In total, the process of applying for and getting your Accion business loan could take one to two weeks.
BEST FOR CROWDFUNDING UP TO $15,000
Kiva
Learn More
From participating partners via businessloans.com’s website.
Editor’s Take
Kiva is a microlender that offers a unique crowdfunding platform for a wide variety of prospective borrowers. Compared to traditional financing, Kiva utilizes your personal network and its own network of 1.6 million investor lenders to crowdfund loans up to $15,000 with terms up to 36 months.
Business owners who apply directly through Kiva’s website may receive 0% interest. Kiva refers to these as Direct Loans, which are only available to businesses in the U.S. and social enterprises internationally. However, if a prospective borrower applies through a Kiva Field Partner—local organizations working in communities to vet borrowers, provide services and administer loans—they will likely pay interest to the partner in some form, which varies by partner.
Loan funds are distributed and repaid through PayPal or Kiva’s Field Partners.
Pros & Cons
No minimum credit score requirement
Does not require cash flow documents
Requires no collateral
Maximum loan amounts of $15,000
All loans are crowdfunded
Long funding times
Eligibility
Because Kiva uses a crowdfunding method, it’s able to offer less stringent qualification requirements. Although Kiva loans don’t require a minimum credit score, cash flow documents or collateral, borrowers are vetted or endorsed by either a local Field Partner, Trustee or members of the community.
Turnaround time
After you submit your application, a Kiva representative will get back to you within 10 to 15 business days. Kiva suggests that “submitting a great photo and business story will help your application make it through the review process more quickly.”
Once you’re approved for fundraising, you have 15 days to raise funds from your own network, and then 30 days to publicly fundraise with Kiva’s network of lenders.
Summary: Best Low-Interest Business Loans
What Are Low-Interest Business Loans?
Low-interest business loans are an affordable financing option designed for growing your business. Business loan interest rates vary by lender, but traditional banks and credit unions typically offer some of the best rates.
You may also qualify for a U.S. Small Business Administration (SBA) loan, which currently offers rates starting at 5% or 6%. Online lenders are also an option, with some offering annual percentage rates (APRs) between 1% and 4%.
You might find that business loans with longer terms have lower rates than short-term loans. However, a long-term loan can cost more in the long run than a short-term loan, even with a lower rate, because interest will have more time to accrue.
How To Get a Low-Interest Business Loan
If you’re looking for a low-interest business loan to grow your business, here are the general steps you’ll need to take before applying.
1. Review Your Qualifications
Business lenders don’t offer the best rates to everyone who applies. You’ll need to meet or exceed the minimum borrowing requirements, which include good or excellent credit scores, two years of business operations and sufficient annual revenue. If you’re pursuing a secured business loan, you must also provide collateral.
2. Research Business Lenders
As a business owner, you have a variety of options for borrowing a business loan, such as:
Traditional banks
Credit unions
Online lenders
SBA loans, which are issued by SBA-approved lenders
Nonprofit organizations and microlenders
Banks and credit unions typically have lengthier application processes than online lenders, but they often offer competitive rates. On the other hand, online lenders may have more flexible borrowing requirements and often fund a business loan quickly.
Researching your options can help you determine which type of lender offers the loan amounts, rates and other features that would best fit for your business’s needs.
3. Prequalify for Loans
Some lenders let you prequalify for a business loan, meaning you can check your rates without impacting your credit score. You’ll provide a few basic details and the lender will run a soft credit check to show customized loan offers.
Prequalifying makes it easy to shop around and compare loan offers. However, your prequalified offer isn’t set in stone—you’ll need to submit a complete application, provide the required documentation and permit a hard credit inquiry to see the final loan terms.
4. Compare Your Offers
When comparing loan offers, look for a loan with the lowest APR. APR is a more inclusive measure of a loan’s costs than the interest rate alone since it includes both interest and fees.
In addition to the loan’s APR, compare repayment terms and other loan features. As mentioned, a loan with a lower rate but a longer term may cost more in the long run than a short-term loan with a higher rate.
If snagging a low rate means signing on to debt for several more years, you might be better off picking a loan with a shorter repayment timeline. The Forbes Advisor business loan calculator can help you crunch the numbers to see which rates and terms work best for your budget.
5. Choose a Loan and Apply
If you find a loan offer that works for you, your next step is to submit a full application. The process will vary by lender, but you’ll need to provide personal and business details and provide any required documents.
This documentation might include a business plan, business licenses, legal documents, bank statements and tax returns.
How To Qualify for a Low-Interest Business Loan
To qualify for the lowest rates, you’ll need to pass a lender’s underwriting requirements with flying colors. That means having good or excellent credit and being in business for a couple of years. Some lenders also like to see that your business is in a low-risk industry.
Here’s how to qualify for the best low-interest business loans:
Have strong credit. As with most loans, business lenders assign the best rates to borrowers with the strongest credit. Aim for a FICO score of at least 670, but a score of at least 720 is even better.
Be in business for a certain period of time. Some lenders will lend to businesses that are just six months old, but others will want to see that you’ve been around for at least two years.
Show sufficient annual revenue. A minimum revenue of $100,000 to $250,000 is recommended.
Provide all required documentation. This may include a business plan, bank statements, tax returns and more. If you’re applying with collateral, you’ll also have to provide proof of the value of your asset.
Tips for Comparing Low-Interest Business Loans
When comparing low-interest business loans, consider these factors in addition to the loan’s APR:
Repayment terms. Review your repayment term options to make sure you’re comfortable with the monthly payments and the amount of time you’ll be in debt.
Loan amounts. Lenders set their own minimum and maximum amounts, so look for one that can provide the funding you need.
Fees. Keep an eye out for additional fees, such as origination fees or prepayment penalties, that could add to your borrowing costs.
Funding speed. Find out how long the lender will take to underwrite and process your loan to ensure the timeline fits your needs.
Qualification criteria. Reviewing the borrowing requirements is especially important if you don’t have a strong credit score or haven’t been in business for long.
Customer service options. The quality of customer service can make or break your borrowing experience. Check whether the lender offers support via phone, email or web chat.
Reputation of the lender. Read over customer reviews to make sure the lender is reputable and doesn’t have any red flags.
Alternatives to Low-Interest Business Loans
If you want to explore alternatives to low-interest business loans, here are a few potential options:
Business line of credit. Unlike a business loan, which provides a lump sum amount up front, a business line of credit lets you draw from it on a revolving basis. This flexibility might be preferable, depending on your business needs.
Business grants. While business grants are competitive, pursuing one could be well worth the effort. Grants offer money that you can pour into your business without having to pay them back.
Business credit card. You can use a business credit card to pay for business-related expenses and earn rewards for your spending. Some business cards also come with an introductory period of 0% APR.
Personal loan. Unlike a business lender, a personal loan lender doesn’t review your time in business or revenue. You’ll need to meet personal credit and income requirements to qualify. Note that some lenders have rules against using a personal loan for business expenses, so check with the lender about any restrictions.
Crowdfunding. Sites like Kickstarter and Indiegogo can help you raise money for your business from people who support your vision. You’ll typically give rewards to people who donate and you may have to hit your funding goal to receive any or all of the funds.
Methodology
We reviewed 15 popular lenders based on 16 data points in the categories of loan details, loan costs, eligibility and accessibility, customer experience and the application process. We chose the best lenders based on the weighting assigned to each category:
Loan cost: 35%
Loan details: 25%
Customer experience: 20%
Eligibility and accessibility: 10%
Application process: 10%
Within each major category, we also considered several characteristics, including available loan amounts, repayment terms and applicable fees. We also looked at minimum credit score and time in business requirements and the geographic availability of the lender. Finally, we evaluated each provider’s customer support tools, borrower perks and features that simplify the borrowing process—like online applications, prequalification options and mobile apps.
Where appropriate, we awarded partial points depending on how well a lender met each criterion.
To learn more about how Forbes Advisor rates lenders, and our editorial process, check out our Loans Rating & Review Methodology.
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Information provided on Forbes Advisor is for educational purposes only. Your financial situation is unique and the products and services we review may not be right for your circumstances. We do not offer financial advice, advisory or brokerage services, nor do we recommend or advise individuals or to buy or sell particular stocks or securities. Performance information may have changed since the time of publication. Past performance is not indicative of future results.
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