Business lines of credit are harder to find for new businesses, but it’s not impossible. Check out these top picks.
$150,000
4.66% to 8.99%
4.66% (12 weeks)
8.99% (24 weeks)
3 or 6 months
600
3 months
At just three months, Fundbox has the shortest time-in-business requirement on this list, making it an excellent fit for startups. In addition, its low minimum credit score requirement makes it a good choice for business owners with less than stellar credit. Still, you may be more limited with Fundbox’s line of credit than with other options because its funding cap is just $150,000, which is much lower than some other competitors.
$6,000 to $100,000
39.90% This rate reflects the estimated starting APR offered to at least 5% of OnDeck customers. It doesn’t reflect the minimum APR offered by the company.
12, 18 or 24 months
625
12 months
OnDeck’s ability to provide same-day funding is what really sets it apart from the competition. Its lenient qualifying requirements, including its $100,000 annual revenue requirement and minimum credit score requirement of 625, ensure that it’s an attainable option for newer businesses.
At the same time, you’ll be subject to a low funding cap once again. Plus, since OnDeck doesn’t publish its starting interest rates, it can be hard to estimate how much you’ll pay for the privilege of borrowing.
$2,000 to $250,000
3.00% to 27.00%
3% to 9% for 6-month loans
6% to 18% for 12-month loans
9% to 27% for 18-month loans
12% to 18% for 24-month loans
6, 12, 18 or 24 months
660
12 months
American Express’ streamlined application process and transparency about its interest rates make it a strong pick for those looking for an affordable business line of credit. Plus, its lack of a prepayment penalty ensures that you’ll likely save money over some competitors if you decide to pay off your line of credit early.
Still, with a minimum credit score of 660, American Express is likely a better fit for those with excellent credit scores. In addition, be aware that the company’s personal guarantee requirement means you’ll be expected to repay the loan if your business is unable to foot the bill.
Up to $5,000,000
10.75% to 14.25%
14.25% for loans $50,000 or less
13.75% for loans $50,001 to $250,000
12.25% for loans $250,001 to $350,000
10.75% for loans above $350,000
Some lenders may charge lower rates. Based on the current prime rate of 7.75% + a rate maximum set by the SBA. Fixed-rate loans will have higher rates.
Up to 120 months
680 (Recommended)
24 months (Recommended)
The Small Business Administration’s Working CAPline is a form of an SBA 7(a) loan that is designed to help business owners who may not be able to qualify for more traditional financing by providing them with cyclical funding. Its capped interest rates and flexible qualifying standards make it a smart choice for newer businesses, but there are a few tradeoffs.
For one, SBA loans may come with personal guarantees or collateral requirements, and the application process and funding times may take longer than through other lenders.
From $1,000
Not disclosed
12 months
Not disclosed
6 months
As a secured financial product, Bank of America’s Cash Secured Line of Credit works a little differently than other business lines of credit. This line of credit requires a minimum security deposit of $1,000 to open an account. Plus, your available funding will be equal to the size of the security deposit you can make.
The bank only requires six months in business and $50,000 in annual revenue, which is why it’s one of our best picks for newer businesses. Still, the funding you can access will be limited to what you can afford to put down, making it less flexible than some other options on this list.
$1,000 to $250,000
8.49%
6 to 18 months
600
6 months
Requiring just six months in business and $50,000 in annual revenue, Lendio’s marketplace is a smart option for startups who need to find a line of credit, especially since the funding cap extends to $250,000. However, in exchange for the flexible qualifying standards, you will face relatively short repayment terms and potentially high interest rates. Available rates go as high as 60.00%.
A business line of credit is a flexible form of small business funding. Unlike a term loan, which disburses the money in one lump-sum payment, a business line of credit typically works more like a credit card.
You can use it to borrow money up to a certain limit. You’ll only pay interest on the amount that you’ve borrowed, and you can borrow against your limit again once you’ve paid down your balance.
Typically, most financial institutions require you to be in business for at least two years before extending you a line of credit. However, our picks for best business line of credit for new businesses have shorter time in business requirements.
On this page
| Pros | Cons |
|---|---|
Can withdraw money as needed Only pay interest on the amount that you borrow Typically has lower interest rates and higher borrowing limits than a credit card | Not the best pick for financing large purchases or ongoing expenses May need to secure your financing with collateral Additional fees can elevate the cost of borrowing |
Luckily, it is possible to get a business line of credit as a new business. All you need to do is research available lenders until you find one for which you meet or exceed the qualifying requirements. The list above can help you get started in your search.
Most banks require you to have at least a two-year business history before applying for a line of credit. However, some banks have more lenient qualifying requirements. For example, Fundbox only requires you to show six months in business.
The process for getting a business credit card as a startup often involves incorporating your business, obtaining an EIN number and applying for a card that suits your needs.
