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The Best Small Business Loans to Help with Bad Credit

Loans for Borrowers with less-than-perfect Credit

By Kathy Haan

Updated 21 October 2022

Facts verified by Vikki Velasquez

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If you’re not able to establish credit even if you have bad credit, you are still able to get a small-business loan. It’s because the credit score isn’t as important in the same way as the overall financial health of your business. Most lenders require a minimum credit score of 500, with at least six months in operation, and more than $30,000 in annual revenues.

Small-scale business loan products are:

Merchant cash advance

Invoice factoring

Line of credit

Working capital

Expansion of business

Equipment financing

Small-business administration (SBA) loans

You can expect to pay more costs and interest rates if you are not able to credit an owner of a business. If you are able to take out specific loan products, for instance invoice factoring loan or a cash advance, these loans are based in the future of sales, or on funds that has been invoiced but not received.

We looked at 19 different small-business loan lenders to determine the best option to those with poor credit. The terms and rates of loans should be affordable, and these were key factors when evaluating our choices. We also considered authentic reviews from customers, credit score requirements, and loan amounts available.

The Best Small Business Loans for People with Bad Credit for 2023

Best Overall: OnDeck

Best Short-Term Loans: PayPal

Best Line of Credit: Lendio

The best option for financing long-term: Rapid Finance

The best option for high-revenue Trustworthy

The Best Small Business Loans for Bad Credit

Our Top Picks




Rapid Finance


See More (2)

The Bottom Line

Compare Providers


What is a Personal Guarantee?

What Credit Score Do You need to get the SBA Loan?

Is It Possible to Get a Business Loan With Bad Credit?

What Is the Easiest Business loan to get?


Top Overall OnDeck


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OnDeck is the top overall small company loan lender for bad credit, as it accepts score of 625, and it’s possible to fund same-day. If you’ve been in business for more than one year, have an account in your business’s bank and have at minimum $100,000 in annual revenues You can apply for a loan.


625 minimum credit score

The possibility of funding on the same day is there.

Request more cash after you’ve repaid half of the original loan


Very high rates of interest

Requires a daily or weekly payment

It is not possible to lend to businesses located in Nevada, North Dakota, South Dakota, and in certain specific industries

Launched in 2006, OnDeck is a publicly traded small business lender that is accessible on the internet and via phone. This is the best overall small business lender for bad credit since to be eligible for an loan it is necessary to have a credit score of 625. This is less than what many companies allow. Additionally, once you have received loan being approved, you will get your funds as early as the next day, and can receive more money after you have paid off the half of the loan.

You are able to borrow anything between $5,000 to $250,000 and credit lines that range from $6,000 to $100,000. The amount available to borrow depends on your business revenue.

The terms of repayment for term loans can be up to 24 months, and 12 months for the line of credit loan. If you’re using a term loan when you’ve paid half of the loan and you’re able to request more funds and you won’t be charged any interest remaining on your existing loan. Contrary to most lenders, the repayments are made on a regular basis, either weekly or daily depending on the company details you supply to OnDeck.

For both long-term loans or lines of credit loans is 29.9 percent as of January 2023. If you pay off the loan early may result in the remaining interest being waived. However, this prepayment benefit option will mean an increase in the APR. OnDeck also will take the form of a general lien on all business assets and require personal guarantees.

Best Short-Term Cash Loans PayPal


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We picked PayPal LoanBuilder as the lender with the best short-term loans because it offers loan terms ranging from 13 to 52 weeks. The minimum credit score needed to qualify for an loan is 580 and funding can happen as soon as the next business day.


580 minimum credit score

Loan terms between 13 and 52 weeks

You can receive funds as early as the next working day


Must have business revenue of more than $33,300 annually.

No financial benefit for paying the loan early, as the entire fee is due upon completion of the loan.

Startups are not available for this.

PayPal is an online payment system now offering short-term small business loans called LoanBuilder. It’s a loan is also called a Business Loan–it’s the same. Lending is through WebBank which is a member of the FDIC. It is the top short-term small business loan service for those with bad credit as loan terms are a maximal of 52 days, and you need only a 580 credit score to qualify.

The loan application can be completed online or on the phone within five to 10 minutes, and approval is quick. Once you’ve been approved, you can receive funds of $5,000 to $150,000 directly into your bank account as soon as the next business day.

A blanket lien and personal guarantees are required to obtain a loan. The automatic weekly repayments are taken from your bank account. While you can’t adjust the frequency of repayment, you can specify which day of the week payment is made. If a payment fails the bank will charge you a non-sufficient funds (NSF) cost.

If you make your payments on a regular basis, you don’t have to have to pay any charges other than one-time fees for borrowing, calculated as a percentage of the loan amount as opposed to a traditional APR. You won’t be able to save any money when you pay off the loan early.

Best Line of Credit Lendio


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If you’re in need of flexible financing, consider the possibility of a small-business credit line from Lendio. You’re not obligated to utilize all funds, and you don’t pay for the funds you don’t use. A lot of people view a line of credit like a safety net–it’s there if you’re in need of it.


Minimum credit score of 560

You must pay the interest only on funds you use

Application takes just 15 minutes


You must have at least $50,000 in annual revenue

The funding process can take between one and two weeks

A loan term of between one and two years

Lendio is a small-business lending marketplace launched in the year 2011 that connects businesses with over 75 different lenders to secure the funding they need. Since Lendio does not create the loan it gives you numerous offers and are able to choose the one that’s most compatible with your requirements. This is the ideal credit line for small-sized business owners with low credit scores because you only require a credit score of 560 and you have no obligation to utilize all of your funds. Additionally, you do not pay any interest for the funds that are not used.

Line of Credit applications last about 15 minutes. They can be a fantastic option for businesses that are at least six months of age with annual revenues of at least $50,000. Businesses need to have an average credit score of 560 and be willing to wait up to two weeks to receive funding. The terms of loans are one to two years.

With a line of credit you are able to borrow against it as often as you want, provided that you don’t overdraw the limit of your credit. You can borrow between $2,000 and $500,000 at rates of between 8% and 24%. Based which lender go with, they might request an individual guarantee.

Your repayment amount and frequency depend on the final lender you select. However, the longer you’ve been in business and the better your score on credit, the less your monthly payments will be.

Ideal for long-term financing Fast Finance

Rapid Finance

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Through Rapid Finance, you can borrow up to $1 million according to your monthly earnings and loan terms that range from 60 months. This lender will look at the health of your business–not only your personal or business credit score when determining whether your business is eligible to receive funding.


The loan terms can be as long as 60 months

Assesses overall business health and not just a credit score

You can access funds within 24 hours of approval


Repayment details not available online

Rates on interest not accessible on the internet.

Rapid Finance is a sister company to Quicken Loans and offers lending solutions for medium and small enterprises. The site has outstanding reviews and boasts one of the longest business loan durations at sixty months (most lenders are just two or three years old). These factors make it the most suitable small business loan option for long-term financing with poor credit. Plus the moment you make an application for a loan typically, you will be approved and funded within days.

To qualify to receive a loan to be eligible for a loan, your company must be 3 to 6 months old in order to qualify for most of its small business loans. However, other loan types, such as most of its short-term loans, require minimum two years in the business. A blanket lien is required.

Rapid Finance advertises daily, monthly or weekly installments however, the site provides little more information than that. No interest rates are published online, so it’s necessary to reach out to the customer service department for information on repayments.

The best option for high-revenue credibility


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To be eligible for a small business loan through Credibly, you must have revenue of at least $15,000 per month. This makes it a great option if you have revenue. Funding is quick, and the minimum credit score is 500.


500 minimum credit score

Available to businesses at least six months old

Offerings of up to $400,000 and the funds are available the next day


The minimum amount of revenue required is $15,000 per month

Repayments on a weekly or daily basis.

Credibly is a lender that was established in 2010 and offers one of the lowest minimum credit scores (500) out of all lenders we looked at. The reason they can do this is because it is the most suitable choice for small companies with large revenues. Businesses need to have a minimum monthly revenues of $15,000 and be in business for at least 6 months. Additionally, you’ll pay higher fees as opposed to other lenders.

Select from a variety of different kinds of small business loans:

Working capital loan

Business expansion loan

Line of credit for businesses

SBA loan

Cash advance for merchants

Equipment financing

Invoice factoring

Based on the credibly loan product you choose, you can borrow up to $400,000 and enjoy loan terms up of 24 months.

The company charges you a 2.5% origination fee in addition to the factor rate. This factor rate starts at 1.15. This means on the $ 10,000 loan that has a factor of 1.15 you’ll have to pay a $1,500 fee along with the 2.5 percent origination fee on an $10,000 loan.

The Bottom Line

Small-scale business loans can help you grow your business, cover payroll and other expenses, and manage cash flow. If you’re a poor creditor, finding a lender can be difficult, but there are a variety of loan alternatives available to those with credit scores as lower as 500. Some lenders don’t have a minimum score, and instead, look at the overall health of the business.

We recommend OnDeck for your small business loan needs if you have bad credit because it offers instant funding, with a minimum credit score of 625. It also rewards loyalty–after repaying half of your loan you are able to apply for additional money, and you will not be charged any remaining interest on the original loan.

Compare Providers

Small Business Loan Wins For The Most Important Benefit


Best Overall Same-day Funding and a minimum credit score of 625


Best Short-Term Loans terms between 13 and 52 weeks


Best Line of Credit Pay interest only on the funds you use with no obligation to use it.

Rapid Finance

Ideal for long-term financingUp to 60 months and fast financing


Ideal for high-revenue businessesA minimum credit score is 500, provided you make $15,000 in monthly income

Frequently asked questions

What Is a Personal Guarantee?

A personal guarantee means that the business owner assumes the business’s debt in the event that the company is not able to pay it. This protects lenders in case of default and also makes it easier for a company to be eligible for the loan when they might not be able to without the protection of a personal guarantee.

What is your credit score? need to get the SBA Loan?

It is important to note that the Small Business Association (SBA) does not specify the minimum credit score required to obtain an SBA loan. It is true that SBA loans are provided by lenders that may require a minimum score. In general, the minimum requirement is approximately 620.1 However, the higher your score higher, the more likely to receive approval.

Is it possible to get a Business Loan With Bad Credit?

Yes, it’s possible to obtain a business loan with poor credit. Certain lenders do not require a minimum credit score and take into consideration their overall financial health and the company instead. But, you could be expected to pay higher fees or have a higher APR when you have poor credit.

What Is the Easiest Business Loan to Get?

The easier business loan to get can be one with a security. This means that the loan is secured by collateral, and the lender gets that collateral in the event that the business owner fails to pay the loan. The collateral that is pledged generally comprises inventory, property equipment, savings accounts as well as blanket liens and personal guarantee.

How to Choose the best Small Business Loans to Help People with Bad Credit

We evaluated 19 of the best small commercial loans available and reduced it to the best six options for bad credit Based on a variety of characteristics and aspects. We considered rates, credit score requirements, loan amounts, and the repayment conditions. The reviews of customer service as well as sales and user-friendliness weighed heavily in our selection of a small business loan should be a pleasant and stress-free experience for owners of businesses.

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