Are you a business owner in the United States and looking for funds to start or scale up your business venture? The major problem with starting a startup company is getting funds from traditional banks. Normally, it turns out to be extremely tough to convince a bank to release funds in the starting phase of a company. Here in this article, we list the top small business loans in the United States.
It is a matter of fact, loans from traditional banks are lower in interest rates. If you qualify to receive a loan from banks, that is the best thing that can happen in financing your startup venture. If you don’t, no need to worry. There are several reputed online lenders who are working directly with small business owners in providing startup loans. Receiving loans from these lenders are more simple, and more transparent and most importantly the loan processing time is quick.
Before applying for business loans from lenders, let us put forward some suggestions. Firstly, try to clean your personal credit score if it is a mess. Secondly, prepare a proper business plan so that investors feel interested in investing in your business. And thirdly, choose the best business lender as per your needs.
Here we list down the list of genuine online lenders who can be the right financial partner for your upcoming small business.
List of 5 Small Business Loans in the United States
1. Lending Club
Lending Club is the most popular peer-to-peer lender for small businesses. They started lending to small businesses in the year 2014. You can ask for a minimum loan of $5000 to a maximum of $300,000 from the Lending Club. Interest rates range from 5.99% to 29.99% APR.
To qualify for a business loan from the lending club, you must be in the business for more than 1 year with at least a $50,000 annual sales turnover. In addition to this, you must have 20% ownership of the business.
Kabbage is very helpful for small business owners who fail to get approval for a cheaper loan. The easiest part of getting a loan from Kabbage is less paperwork. You just need to fill up an online application form which takes just a few minutes. If you have a low credit score, try Kabbage.
Kabbage was founded in the year 2008. However, in 2020 it was acquired by American Express. Hence Kabbage has become a more trustable name in the finance industry after it is part of the American Express Group.
Kabbage offers loans of up to $250,000 with repayment terms of six or 12 months. Kabbage’s annual interest percentage rates range from 24% to 99% APR.
Ondeck started funding small businesses in the year 2007. The company is listed on the New York Stock Exchange. To avail of a business loan from Ondeck, you must be running your business for at least a year with gross annual revenue of more than $100,000. In addition, you must have a minimum of 500+ personal credit scores.
On Deck offers interest rates as low as 13.99 APR depending upon your financial health. The maximum loan that you can get from Ondeck is $500,000.
Prosper is much like Lending Club. Though they don’t offer small business loans, you can opt for their product on unsecured business loans to solve an immediate small amount of funding. You can ask for a maximum of $35,000 from Prosper.
The interest rate ranges from 5.99% to 35.99% APR. Normally it takes two weeks to process the loan request.
5. Funding Circle
Funding Circle is a peer-to-peer lending marketplace. This peer-to-peer funding platform allows investors to lend money directly to small and big businesses. Funding Circle started its operation in the UK and presently caters to the UK, US, Germany, and the Netherlands.
You can ask for $25,000 up to a hefty $500,000 from Funding Circle. Interest rates are 4.99% to 26.99% APR. you can pay it back in six months to five years.
This is our list of top small business loans in the United States. However, it must be mentioned here, receiving loans from these lenders will prove a little costly. If you are looking for cheaper loans, try traditional banks, credit unions, and government loan schemes.
About the Author: 99businessideas.com led by Rupak Chakrabarty is committed to helping beginners, entrepreneurs, and small business owners in starting, managing, and growing their business. Our aim is to educate the entrepreneur on the various stages of entrepreneurship.