Best Small Business Loans Of 2024

Camino Financial30 Jan 2024
Best Small Business Loans Of 2024
Choosing the best small business loans can significantly impact your company's success and sustainability. However, with the breadth of commercial capital available, business owners might need help determining which one is suitable for them. The best commercial loan depends on your individual needs. To choose the best one for your organization, you must compare requirements, rates, fees, and more. Fortunately, this guide lists the top loans.
Table of Contents
1. Best 15 small business lenders
2. What is a small business loan?
3. Pros and cons of small business loans
4. Types of small business loans
5. Requirements for small business loans
6. How to choose a small business loan
7. How to apply for a small business loan
7. Where can you get a small business loan?
7. Small business loan alternatives
7. FAQs

Best 15 Small Business Lenders

Here are the top business lenders. Analyze each one to find the one that'll suit your business needs better.

Camino Financial

  • Loan Amount: $10,000 to $50,000
  • Credit Score Required: 670
  • Tenure: 24 months
  • Requirements: Min. 12 months registered and operating, min. an annual income of $30,000
Apply for a business loan today


  • Loan Amount: $5,000-$250,000
  • Credit Score Required: 625 Personal FICO score
  • APR: Starting at 29.9%
  • Tenure: 24 months
  • Fees: 0%-4% origination fees, late and returned payment fees possible
  • Requirements: Min. 1 year in business, Min. annual business revenue of $100,000, business bank account


  • Loan Amount: Up to $150,000
  • Credit Score Required: 600+
  • APR: Starting at 10.1%
  • Tenure: Maximum 24 weeks
  • Fees: Potential late payment and non-sufficient funds fees
  • Requirements: Min. 6 months in business, Min. annual revenue of $100,000


  • Loan Amount: $5,000-$250,000
  • Credit Score Required: 625+
  • APR: Starting at 15% and up to 78%
  • Tenure: 6 or 12 months
  • Fees: $15 fee for wire transfers, potential late fees
  • Requirements: Min. 6 months in business, Min. annual revenue of $120,000

National Funding

  • Loan Amount: Working capital loan: $5,000-$500,000, Equipment Financing Loan: up to $150,000
  • Credit Score Required: Personal credit score of 600+
  • APR: Varies
  • Tenure: Short-term loan:4 months-2 years, Equipment  financing: 2-5 years
  • Fees: 1% origination fee
  • Requirements: Min. 6 months in business, Min. $250,000 in annual revenue

Funding Circle

  • Loan Amount: $6,000-$250,000
  • Credit Score Required: 660+
  • APR: 10.64%-31.85%
  • Tenure: Up to 7 years
  • Fees: 4.49%-8.49% origination fee, 5% of missed payment for late payment fee
  • Requirements: Lien on business assets, personal guarantee required, 2 years of business history


  • Loan Amount: $25,000-$500,000
  • Credit Score Required: 575+
  • APR: N/A
  • Tenure:  12-36 months
  • Fees: Possible origination and closing fees, underwriting fee of $250-$400 for nonbank loan
  • Requirements: Min. 6 months in business,  Min. annual revenue of $100,000

TD Bank

  • Loan Amount: $10,000-$1 million
  • Credit Score Required: N/A
  • APR: N/A
  • Tenure: 12-60 months
  • Fees: N/A
  • Requirements: Aggregate loan exposure under $100,000


  • Loan Amount: $30,000-$350,000
  • Credit Score Required: 675+ personal score
  • APR: 6.73%-10.29%
  • Tenure: Varies
  • Fees: 4% cut from approved loans, referral and packaging fees, potential additional fees
  • Requirements: Min. 2 years in business, Min. $50,000 annual revenue

SBA Microloan

  • Loan Amount: Up to $50,000
  • Credit Score Required: N/A
  • APR: 6%-9%
  • Tenure: Max 7 years
  • Fees: Up to 3% of the loan amount (2% for loans with terms under 12 months), closing costs
  • Requirements: For-profit businesses, eligible industry, must have attempted to secure alternative financing


  • Loan Amount: $2,000-$250,000
  • Credit Score Required: 640+
  • APR: Varies
  • Tenure: 6, 12, 18 months
  • Fees: Monthly depending on loan term, late and unsuccessful payment fees
  • Requirements: Personal guarantee, Min. 1 year in business, Min. monthly revenue of $3,000

Bank of America

  • Loan Amount: Unsecured: $10,000 to $100,000
  • Credit Score Required: Average FICO of 700+
  • APR: Varies
  • Tenure: Unsecured: 12-60 months
  • Fees: Unsecured: $150 origination fee
  • Requirements: Min. two years in business, Min. annual revenue of $250,000+, Min. annual revenue of $100,000 for unsecured loans

Rapid Finance

  • Loan Amount: $5,000-$1 million
  • Credit Score Required: 550+
  • APR: N/A
  • Tenure: 3-60 months
  • Fees: Fixed fee for loans varies
  • Requirements: Potentially requires a lien

US Business Funding

  • Loan Amount: Up to $5 million
  • Credit Score Required: 650+
  • APR: N/A
  • Tenure: Max 7 years for working capital, 10 years for equipment, and 25 years for real estate
  • Fees: Guarantee fees
  • Requirements: Min. 1 year in business, physical business location, history of solid business revenue

PNC Bank

  • Loan Amount: Unsecured: $20,000-$100,000
  • Credit Score Required: N/A
  • APR: N/A
  • Tenure: Unsecured: 2-5 years
  • Fees: N/A
  • Requirements: On-time payments for the past 5 years, business checking account with PNC, personal guarantee, min. 3 years in business

What is a Small Business Loan?

Small business loans are financing options offered by numerous lenders to help entrepreneurs finance their businesses in various ways. They give approved applicants a lump sum of money they can use to invest in their companies. Getting a business loan allows entrepreneurs access to funding for building and expanding their organizations.
#DidYouKnow The average interest rate on a business loan is from 6% to 45%.

How Do Small Business Loans Work?

Small business loans involve a business owner borrowing capital from business lending companies or individual lenders. Borrowers must repay the business loan with interest rates over a set period. Depending on the organization and the lender, these loans have varying terms, amounts, and rates.
Business loan uses

Pros and Cons of Small Business Loans

Any business financing solution has unique advantages and disadvantages you need to consider. The pros of small business loans are:
  • Faster business growth
  • Fewer issues with cash flows
  • Convenient
  • Access to significant amounts of capital
  • Potential for lower interest rates
  • Various types of loans
  • Eliminate the need to dilute your equity
Their cons are:
  • Potential damage to cash flow based on debt repayments
  • High-interest rates for borrowers with low credit scores
  • The lengthy application process for many lenders
  • Possible loss of your assets when you default on payments
  • Strict repayment terms
  • Difficult to qualify for depending on lender requirements

Types of Small Business Loans

Below is a deep dive into the primary types of small business loans.

Secured and Unsecured Business Loans

A secured small business loan requires that borrowers offer assets and collateral upon receiving the loan. They typically favor the borrower and have lower interests because the collateral guarantees repayment. Unsecured small business loans do not require assets and collateral from borrowers, making them easier for the small business but riskier for the lender. Interest rates are typically higher, and qualification terms are strict. With these loans, you will likely repay more to the lender than with a secured loan.
Secured vs. unsecured business loans

Open-End and Closed-End Business Loans

Open-ended small business loans offer borrowers a revolving line of credit with fewer restrictions on a repayment schedule or how the loan is used within your business. It allows the borrower to take out the amount of approved money and repay the lender on an ongoing basis. With open-ended loans, you must ensure that you don’t exceed your credit limit. Though you don’t have to repay the whole open-end loan by a specific date, you will make monthly payments based on your current unpaid balance. A closed-end small business loan offers borrowers a fixed amount of funding that the borrower must repay within a set period and additional interest fees. Borrowers must repay lenders regularly, such as in monthly installments.

Government-Backed and Conventional Loans

Government-backed SBA loans are issued to small businesses by SBA-approved lenders. The Small Business Administration works with lenders to provide business owners with various options for funding, and these loans are delegated to owners who cannot access a conventional loan.
#DidYouKnow The SBA provides loans to qualified businesses from its 7(a) Loan Program as well as its 504 Loan Program for commercial real estate and other business assets.
On the other hand, government agencies do not back conventional loans. Financial institutions, including banks and credit unions, offer these loans and involve a lender approving small businesses to receive lump-sum funding for their organization. Conventional small business loans require that small business owners repay their borrowed funds along with interest and other fees over a specified timeline. With government small business loans, individual lenders are protected from financial damage by the SBA; with conventional loans, the risk lies with each lender, making it risky for banks.
Do you qualify for SBA loans?

Long-term and short-term business loans

Long-term small business loans are typically used to finance large purchases and investments, such as building an office space or buying equipment. Long-term loans also have lower interest rates than short-term ones due to their extended repayment plans. They tend to have repayment terms of 5 or more years. A short-term business loan is usually used for immediate needs, like cash flow during a slow season or covering emergency maintenance. These loans typically have a lower borrowing limit than long-term ones, and interest rates are usually higher. Additionally, short-term loans tend to come with more stringent terms and require quick repayment. They tend to have repayment terms of 12 or less months.
A guide to term loans

Requirements for Small Business Loans

A glance at different options for small business loans reveals that receiving a loan isn't always a straightforward process. There are various requirements for small business loans specific to each lender. However, there are standard requirements to expect from any lender that you should consider as you navigate your potential options.

Credit score

With a solid personal credit score, small businesses will likely have more access to funding from lenders. Lenders require stable credit scores to ensure that the borrower is reliable and can be trusted to make a total repayment to the lender.
Learn here how to raise your credit score.


Conventional loans are hazardous for lenders because financial responsibility falls upon them if a borrower defaults on payments. Collateral is required to mitigate the risk of lenders losing significant funds from their investments. Even if a lender doesn’t require collateral per se, they might ask for a personal guarantee.

Financial stability

Lenders also require applicants to have specific cash flow and income rates. When applying for a loan, you will receive a request to provide financial documentation for your business. Checking your company’s cash flow and income statements allows lenders to decide which companies to fund. A higher cash flow and income make you more likely to receive a loan, as you will be seen as trustworthy compared to other businesses. Lenders hold these requirements to assess risks when they invest.

Time in business

While this might seem insignificant, lenders maintain this requirement because businesses without a solid and lengthy background are difficult to predict. A business in its first months of operation will need help to prove its sustainability and longevity to investors. When applying for a loan, remember that investors want a track record before making their final decision.

How to Choose a Small Business Loan

It is essential to understand how to select a small business loan that best suits your needs and business. Selecting a small business loan requires you to ask yourself specific questions to help narrow down your options. Consider some of the questions below as you navigate your decision:
  • How much money do you need from a loan?
  • What is your credit score?
  • Do you have collateral that you are willing to offer?
  • In what part of your business will you use the money?
  • How long do you expect it to take for total repayment?
  • Do you want a short-term or long-term loan?
  • Are you open to online business loans?
  • What are your business’s current finances?
  • How long have you been in business?
  • Have you looked for alternative funding sources?
  • What risks are you comfortable taking?
By asking yourself these questions, you can make an informed decision on where to apply. While lenders have many things in common, there are crucial differences to consider when determining which is the right fit for your business. However, these questions only scratch the surface of what you should know about selecting the right small business loan. Below are some additional considerations to remember when considering your options.

Estimate How Much You Can Borrow

Though you might know how much funding you need to cover your business operations, it’s essential to identify how much you can realistically borrow while still maintaining your repayment schedule. Staying realistic is essential no matter how much you want from a loan. Without estimating how much you can safely borrow, you can set your business up for financial ruin in the long run.

Check Your Creditworthiness

Lenders will look at your business and personal credit history to determine your reliability. Before selecting a small business loan and starting your application, look at past financial records. For your business, pay attention to how you have previously managed financial responsibilities and obligations. Frequently missed or inaccurate payments can bring your creditworthiness down significantly. If you have a low business credit score, you must improve your score before you apply for a small business loan. Lenders analyze your creditworthiness by following the five C's of credit:
  • Capacity to repay the loan
  • The "Character" of the borrower, including experience, credentials, and outstanding debt
  • Collateral assets to offer lenders before securing a loan
  • Capital/personal financial investments to demonstrate a financial commitment to your business
  • The Conditions in your industry, such as competitors, environment, and economy

Business Credit Vs. Personal Credit

When considering different small business loans and analyzing your creditworthiness, ensure that you know the difference between business and personal credit. Personal credit is a number that lenders will consider to determine the trustworthiness of your character, and personal credit is measured by the FICO method. Business credit is typically centered on how your company pays its bills, current debt, and industry. If you have a low business credit score and are concerned about your score negatively influencing lenders’ decisions, rest assured that business credit scores are much easier to improve than personal scores. While both types of credit matter when applying for a small business loan, you can take different strategies to improve each score.

How to Apply for a Small Business Loan

To access a small business loan, follow the quick steps to apply listed below.
  1. Decide who you want as a lender. Banks, credit unions, and online lenders will have different application processes, requirements, and loan terms that might influence your decision.
  2. Gather materials for your loan application. When applying for a small business loan, ensure that you have documents, including your company’s financial statements, business plan, tax ID, collateral plan, bank statements, tax returns, and a personal guarantee for guaranteed loans.
  3. Fill out an application. When you complete it, look it over and double-check everything before turning it in to ensure that everything is accurate and effective.
  4. Continue the application process. Lenders might ask you to confirm your identity, share financial documents or meet other requirements.
  5. Wait for a decision.

Where Can You Get a Small Business Loan?

You can find business financing options from various lenders, including your current bank or credit union. Additionally, online lenders are increasingly popular among small business owners. While traditional lending options like financial institutions offer a wide smaller range of government-backed loans, they are often harder to qualify for, especially if you don’t have an existing account or history with your financial institution. Online lenders tend to have broader, flexible qualifications for borrowers. Businesses seeking online lenders can access funds faster than traditional lending methods, making it a quick and convenient solution for many small business owners. Consider alternative lending sources or CDFIs:
  • Alternative lenders are not associated with any financial institution and offer financing to help small businesses grow without bank or government backing.
  • Community Development Financial Institutions funding could also help your business grow depending on your community and your company’s trajectory.

Small Business Loan Alternatives

If you feel like a small business loan is not what you are looking for, maybe an alternative is better suited to your company’s needs. Below are some options you have for alternative funding to sustain your small business.

Equipment Financing

Equipment financing loans are used solely to access equipment necessary for operating your business. This can include items like manufacturing machinery, computer systems and software licenses, heavy-duty vehicles, and other large pieces of equipment. For instance, this type of alternative funding can help you get the right technology, machinery, or even vehicles for your company. Equipment financing is helpful for companies that don’t need a large sum of money or don’t require funding outside of their normal equipment. Equipment loans are structured differently than traditional short-term business loans—like lines of credit or term loans—but they offer a variety of advantages that may make them an ideal option for your company’s needs.

Line Of Credit

A line of credit for your small business can provide working capital and financial security. They are accessible through banks and online lenders. With a line of credit, you can draw money from a total sum provided by the lender. You will be charged interest only for what you borrow.

Merchant Cash Advance

Merchant cash advances are sums of money granted by lenders and are essentially an advance on your company’s future earnings. The lender holds back a small amount of your credit card earnings, meaning that you will pay a certain amount daily depending on your sales for that day. The problem is that they’re quite expensive.

Invoice Factoring And Invoice Financing

Invoice factoring is a type of alternative funding that accesses cash from outstanding invoices. An invoice factoring company purchases any unpaid invoices from your organization and fronts 85%-95% of the total invoice amount. Invoice financing occurs when a company provides your business with a line of credit while using unpaid invoices as collateral.

Personal Loans

If you can’t find a business loan suitable to your company, consider personal loans. Many small business lenders allow applicants to use personal loans for business operations, and the amount granted is determined by your income and creditworthiness.


Business grants are essentially free money given to small businesses without the need for repayment. While this is ideal, grants are incredibly difficult to secure, meaning it’s essential to consider other options and eligibility requirements first.

Business Credit Cards

Business credit cards are helpful for small business owners looking to fund different parts of their company while simultaneously building a business credit profile. While you must meet certain creditworthiness criteria, business credit cards are a valuable option for any business looking to improve its credit.

Commercial Real Estate Loans

Commercial real estate loans are helpful if you only need business funding to buy commercial properties. For instance, these loans can fund a new office, store location, or expansion for your company.

Family Loans

Family loans are when a family member lends you capital, making them less common for business funding. However, they can make family relationships complicated, especially if, at any moment, you cannot pay.


Online crowdfunding is increasingly popular for small business owners struggling to fund their operations. Crowdfunding is a valuable option because you don’t always have to pay individuals back when they donate to your business; however, this type of funding is often hit or miss.

Working Capital Loans

Working capital loans are designed to help businesses cover immediate and unexpected financial needs. These loans, which typically have shorter repayment windows than traditional business loans, provide businesses with access to quick cash they may need to:
  • pay bills
  • purchase new equipment or inventory
  • manage payroll
  • meet other short-term financial obligations

It's time to finance your business!

Take the time to research and compare different lenders so that you understand the various business loan products available. Before deciding on a small business lender, be sure to consider all of your financing options carefully. Remember to include Camino Financial in your comparison. Our team is available and eager to help you determine the best financing solution for your business, so contact us today if you have any questions about our products. With flexible terms and competitive rates, Camino Financial offers access to capital so you can invest in your small business and continue on your path to success. Let us help you grow your small business. Apply for a business loan today


How do I qualify for a small business loan?

Small business loans have various qualifications for individual lenders. For example, SBA loans require you to be a for-profit business operating in the United States or planning to open a business in the US. You must have reasonable equity and have pursued alternative financing methods.

Are there loans for underserved entrepreneurs?

Yes, there are loans for underserved entrepreneurs–for instance, loans for women, minorities, and veterans are available from various lenders or alternative funding sources.

Can you use personal loans for business purposes?

Yes, you absolutely can. Personal loans are one of the top alternatives to traditional business loans. That doesn’t mean it’s always the best idea.

How hard is it to get a business loan?

This depends on your business and the type of loan and lender you pursue. Businesses are likely to be approved if they have sufficient revenue, credit, and experience.

What type of loan is best for starting a business?

Online loans are among the best options for starting a business. You might also consider crowdfunding to get your business off the ground.

What’s the easiest place to get a small business loan?

Online lenders are the easiest option for accessing a small business loan.

How do SBA loans work?

Once an application is approved, borrowers with SBA loans receive funding. The lender pays these funds with additional interest over a set timeline.

What’s the easiest place to get a small business loan?

Online lenders are the easiest option for accessing a small business loan.

What is the difference between SBA loans and other small business loans?

SBA loans have longer, more flexible repayment terms and lower interest rates compared to traditional small business loans. SBA loans focus less on creditworthiness than traditional lenders.

What is the easiest SBA loan to get approved for?

SBA microloans are among the easiest to get approved for, making them a viable option to get your business up and running.

What credit score do you need for an SBA loan?

SBA loans require a FICO credit score of approximately 620-640.

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