A working capital loan can help finance ongoing or short-term business expenses, like payroll, rent and inventory. The best working capital loan depends on your qualifications and how much you need.
| Lender | User ratings | Best for | Max loan amount | Min. credit score | Min. time in business |
|---|---|---|---|---|---|
 | Bad credit | $1,500,000 | 500 | Six months | |
 | User ratings coming soon | Line of credit | $250,000 | 625 | Two years |
 | Startups | $150,000 | 600 | Six months recommended | |
 | User ratings coming soon | Established businesses | $500,000 | 660 | Two years |
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User Ratings & Reviews
Ratings and reviews are from real consumers who have used the lending partner’s services. | Fast funding | $250,000 | 625 | One year |
 | User ratings coming soon | SBA working capital loans | $5,000,000 | 680 recommended | Two to three years recommended |
| Loan amounts | $5,000 to $1,500,000 |
| Starting interest rate | Factor rates from 1.10 to 1.40 |
| Term length | Up to 15 months |
| Min. credit score | 500 |
| Min. time in business | Six months |
High origination fees
Daily or weekly payments required
Fora Financial provides between $5,000 and $1,500,000 to be used for any business expense with no restrictions. Since its minimum credit score requirement is only 500, it’s a top choice for a bad credit business loan. However, your business will still need a revenue of at least $15,000 a month to qualify.
You can also enjoy fast funding with Fora Financial, receiving your funds within 24 to 48 hours. And while some lenders charge prepayment penalties on business loans, Fora Financial offers an early payment discount.
| Loan amounts | $6,000 to $250,000 |
| Starting interest rate | 6.20% simple |
| Term length | 6 or 12 months |
| Min. credit score | 625 |
| Min. time in business | Two years |
High monthly revenue requirements
Must be in business for at least two years to qualify
A Bluevine line of credit can fund up to $250,000 of business expenses, allowing you to withdraw, repay, then withdraw again. Your application may be approved in as little as five minutes, with funds hitting your business bank account as soon as 24 hours later.
However, your business must operate for at least two years and generate a minimum of $40,000 in monthly revenue to qualify.
| Loan amounts | Up to $150,000 |
| Starting interest rate | 4.66% for 12 weeks 8.99% for 24 weeks |
| Term length | 12 or 24 weeks |
| Min. credit score | 600 |
| Min. time in business | Six months recommended |
Short terms with payments due weekly
Requires $100,000 in annual revenue to qualify
A Fundbox line of credit is an excellent choice for a startup business loan with low credit score and time in business requirements. You can borrow up to $150,000 as needed, only paying interest on the funds you withdraw.
If approved, you can access funds as soon as the next business day. Your company must generate at least $100,000 in annual revenue to qualify.
| Loan amounts | $25,000 to $500,000 |
| Starting interest rate | 11.29% |
| Term length | 6 to 84 months |
| Min. credit score | 660 |
| Min. time in business | Two years |
Requires a minimum of two years in operation
Collateral and a personal guaranty from the main business owner(s) are required
A Funding Circle working capital loan for small businesses could be a good fit if your business has been operating for at least two years and you have a good credit score. You can receive up to $500,000 in funding and get repayment terms of up to seven years. With that time and money, you could tackle a range of ongoing projects for your business.
Note that none of the business owners can have a history of personal bankruptcy within the past seven years. Furthermore, your business must operate within an approved industry to qualify for any Funding Circle small business loan.
| Loan amounts | $5,000 to $250,000 |
| Starting interest rate | 35.40% |
| Term length | Up to 24 months |
| Min. credit score | 625 |
| Min. time in business | One year |
Not available in Nevada, North Dakota or South Dakota
High interest rates
If you need capital fast, OnDeck can deliver funds up to $250,000 as soon as the same business day (criteria applies). You can check your eligibility without a hard credit check with a streamlined application that only takes a few minutes to complete.
OnDeck has a fairly low credit score and time in business requirement, but be prepared for high interest rates and additional fees.
| Loan amounts | Up to $5,000,000 |
| Starting interest rate | Prime rate + 3.00% to 5.00%, depending on loan size and term length |
| Term length | 120 months |
| Min. credit score | 680 or higher recommended |
| Min. time in business | Two to three years recommended |
SBA loan applications can be lengthy and time-consuming
Prepayment penalties may apply
The SBA CAPLine is a specific type of 7(a) loan, but instead of paying out the loan in a lump sum like a traditional 7(a) term loan, it’s a line of credit you can draw upon to use for working capital expenses.
SBA loans are backed by the Small Business Administration, making them more accessible for newly established businesses, minority business owners or those who can’t qualify for traditional business financing. You must operate a for-profit business within the U.S. and be in good standing with other government business loans to qualify for an SBA small business loan or CAPLine.
A working capital loan is a catch-all term for short-term business financing. Due to its flexible nature, working capital funding is an ideal fit for unexpected business expenses or extra cash to expand and grow your business.
The repayment plan and timeline will vary depending on your loan type. Some lenders may require daily or weekly payments from your credit card sales or direct payments from your business checking account.
Working capital loans can be used to cover operating expenses for small businesses, such as payroll, daily costs, inventory and more.
| Pros | Cons |
|---|---|
Flexible funding for a wide range of business purposes Quick funding from some online lenders Accessible to a wide range of businesses with varied minimum requirements | Interest rates can be high due to factor rates Some lenders require daily or weekly payments Collateral may be required for a secured business loan |
If you receive multiple working capital loan offers, consider the following factors when picking the loan that best fits your needs:
Our in-depth catalog of small business lender reviews is a great way to compare business loan options before signing on the dotted line.
When we made our list of best working capital loans, we considered the type of loan product, the required length of time in business, interest rate and term length.
To appear on our list, lenders needed to meet the following criteria:
A working capital loan can be used to cover almost any day-to-day operational expense for your business, such as payroll, rent, utilities, purchasing inventory or covering seasonal lulls. You can use a term loan, line of credit, SBA loan or merchant cash advance for working capital purposes.
To purchase equipment, machinery, or property, consider equipment loans or commercial real estate loans.
Requirements will vary by lender, but you typically need a credit score of 670 or higher to qualify for the best working capital loan rates — although some online lenders offer working capital loans to those with scores as low as 500.
Lenders also consider how long your business has been in operation, most requiring six months to two years. Additionally, you must meet the lender’s annual revenue requirements by providing six months to two years of tax returns and/or bank statements.
While some lenders offer working capital loans for startups, as well as other small business working capital loans, newly established businesses might need to consider other funding options, such as business credit cards or crowdfunding for business.
Some alternative business lenders work with business owners with limited or poor credit. For example, Fora Financial’s minimum credit score requirement is only 500. However, these bad credit business loans tend to come with higher interest rates and less favorable terms than traditional bank loans.
