Are you tired of being turned away when you request a business loan at a bank? Then you should know that there is a better alternative: online lenders.
Online business loans should be your go-to alternative if you need capital to grow immediately. They are faster and sometimes cheaper than traditional bank loans.
But given the myriad of options available, choosing the right financial solution can be tricky.
Luckily for you, we made a list of the top alternative lenders in the country.
We also compare online lenders for businesses with their bank counterparts, describe their pros and cons, and teach you the qualities you should consider while looking for the right business loan.
5 Best Online Lenders for Businesses
Here is a list of the best 5 online lenders for businesses in the United States.
Keep in mind: each lender is different, and although their ratings vary, they are all recognized in the market.
One of these lenders will have the financial solution that best suits your small business needs.
1. Camino Financial
Camino Financial is one of the best online lenders because we offer loans and microloans to business owners to help them grow their businesses and wealth. They promise not to leave any businesses behind, which is why they support immigrants (they accept ITIN) and people with no prior credit history. With us, you can receive funding in as fast as 2 days!
Reviews: Camino Financial clients are very satisfied with the lender’s service, achieving a 4.7-star rating. In addition, customers highlight the speed of the funding, excellent customer service, and ease of application.
Camino Financial’s Small Business Online Loans
Loan amount: Camino Financial offers online business loans from $5,000 to $400,000.
APR: Their interest rates are fixed and can land between 12% and 40%.
Requirements: To receive a loan, your business needs to have:
- an annual income of $30,000 or more
- ITIN or SSN
- been in operation for 9 months
Reviews: OnDeck customers give it a 4.9 rating, highlighting the professionalism of its advisors and the speed of the application process.
OnDeck’s Online Business Loans
Loan amount: You can apply for loans from $5,000 to $250,000.
APR: Starts at 35% for term loans but averages at 54.96%.
Requirements: To get a loan approved, you need to have:
- a credit score higher than 600
- annual earnings of $100,000
- been operating for at least 12 months
BlueVine offers small businesses lines of credit and invoice factoring, among other financial solutions.
Reviews: although clients are satisfied with the service and its speed, some users advise against applying with this lender. It has a rating of 4.5.
BlueVine’s Online Business Loans
Loan amount: With their line of credit, you can receive financing from $5,000 to $250,000.
With their invoice factoring, you can get up to $5 million.
APR: Interest rates for their lines of credit are between 15% to 78%.
For invoice factoring, 15% to 68%.
Requirements: The requirements depend on the type of loan. For a line of credit, you need:
- a credit score of more than 600
- to have been in business for at least six months
- an annual income of $100,000
To be approved for invoice factoring:
- your clients must be other companies or government entities
- you must have a score above 530
- have been operating for at least 3 months
Kabbage is one of the online lenders that specializes in businesses of all sizes. They use artificial intelligence to assess your financial solvency and approve your loan.
Reviews: While users appreciate the quick response time and simple application process, some customers don’t feel as satisfied since Kabbage was acquired by American Express last year. As a result, it has a rating of 3.8.
Kabbage’s Online Business Loans
Loan amount: It is possible to access a line of credit from $1,000 to $150,000 in minutes.
APR: Between 9% to 36%.
Requirements: You can access a line of credit if you have:
- annual earnings of $50,000
- been in business for at least one year
You do not need a minimum credit score to apply.
SmartBiz is a bit different from other online lenders because their loans come from the SBA, so they have very low interest rates (but stringent requirements). The loans can be used as working capital, to buy equipment, or to finance short-term, high-interest loans.
Reviews: The speed of the process, the quality of the support, and the advantages of doing all the procedures online are qualities that SmartBiz users praise. On the other hand, a few complain that they never got the expected response to their request. As a result, the lender receives a rating of 4.6.
SmartBiz’s Online Business Loans
Loan amount: You can access a loan from $30,000 to $5 million.
APR: Can be between 6.73% and 10.29%.
Requirements: You need to:
- have been in business for at least two years
- have a credit score of at least 640
- receive annual earnings of more than $100,000
*All ratings came from the TrustPilot platform in August 2021 and may have changed since.
Get a Small Business Loan Online Today!
Years of experience, excellent ratings, and very happy customers make Camino Financial one of the best online lenders.
By meeting a few requirements, we can process your application in minutes for up to $400,000. Then, you just need to accept the loan terms, and we’ll wire the capital in 24 hours.
We offer the best interest rates and the ability to build your credit score.
Plus, after 8 months of timely payments, you will have the opportunity to graduate to a larger loan, with fewer interests and more time to pay.
There are already hundreds of customers who are very happy with our loans and our service. So why don’t you join them?
At Camino Financial, we don’t leave any small businesses behind.
Online Business Loan: FAQs
What are Online Business Loans?
They are loans that are requested and approved entirely online, thanks to web-based technologies and AI. This speeds up your application process so you can receive funds faster than with conventional banks.
To apply with online lenders, you only need some personal and business information (it’s a paperless process). Then, the lender assesses your ability to pay based on transactions and cash flow in your bank account.
Usually, the process only takes a few hours.
How to Apply for a Business Loan Online?
Obtaining an online business loan is very simple. You just have to follow 3 easy steps:
- Fill out the online application
- Share bank statements, so the lender reviews your cash flows
- Accept the loan terms
Once the process is complete, you can receive your capital very fast. Many online lenders transfer the money the same day (although the bank could take up to 2 days to process it).
Online Business Loans vs. Traditional Bank Loans
When comparing online lenders with banks, the former are the best ones. Here are some of the benefits online loans offer:
- Designed for micro and small businesses: If you are just starting out, have no credit history, and need little capital, online lenders will be more willing to lend you than a bank.
- Easier to get: online lenders don’t usually require collateral, a few months in operation, and a stable minimum income.
- Instant financing: Online lenders can approve your application and disburse funds in a few days, while banks may take weeks or months.
- Lower costs: Since these lenders operate with fewer costs, there may offer reduced fees.
Pros and Cons of Online Lenders
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How to Find the Best Online Lenders?
Before you start looking, you need to assess the needs of your business. Knowing in advance how much money you require and how you will use it will help you define if you need an installment loan, a line of credit, or another type of financing.
It is not easy to find the option that best suits your business, as there are many lenders in the market. We recommend you check online reviews to find the safest and most reliable ones. You could also ask other business owners for advice.
Finally, compare financial products, request quotes to contrast interest rates, and make sure you can use the funds for what you really need.
Depending on your credit score and the amount of money you requested, the interest rates will vary.
The right lender should lend you all the capital you need quickly and on the most competitive terms.
What is the Principal of a Loan?
In simple terms, the principal of an online loan is the money you receive.
Small Business Loan: Apply Online – HOW TO
Applying for a loan online involves completing an application that will require personal and business information. Bear in mind that each lender asks for different requirements, but the most common ones are these:
- Your name
- Your business address
- Business phone number
- Your SSN (lenders like Camino Financial also accept ITINs)
- What your monthly earnings are
- Why do you need to get a loan
- To have a bank account (depending on the lender, it can be a personal or business one)
Also, along with your application, the lender will review your credit history.
The best way to know (even before you apply!) if you should get a loan is by using a business loan calculator.