6 Best Unsecured Business Loans of 2024
🤝 Up To $250K For Established Businesses
- Term Loans Can Fund the Same Day†
- Lines of Credit Can Fund Instantly*
- Fast Application Process, No Hard Credit Pulls
- Flexible Repayment Terms: 12, 18 or 24 Months
Loans Range: $25,000 to $1Million*
- Fixed-rate Financing for Eligible Customers
- Revenue-Based Financing Option
- +$8B in Business Financings Since 2007
- Get Approved in 24 Hours
Online tracking platform + personal Account Manager keep your business goals in check
- Loan amounts: $5,000 to $500,000
- Average yearly revenue requirements: $250,000
- Minimum credit score: None
- Minimum time in business to apply: 1 year
BBB Accredited Company with cash in as little as 24 hours
- Loan Amounts: Up to $500,000
- Average Yearly Revenue requirements: $250,000
- Minimum Credit Score: 600 FICO
- Minimum Time in Business to apply: 6 months
Compare Multiple Offers in Less Than 3 Mins.
- Loan Amounts: Up to $3 million
- Free Application with No Credit Check
- Short & Long Term Loan Options Available
- On Demand Line of Credit Up to Fiixed Limit
Loans Range: $25,000 to $5 Million
- Decision as Fast as 24 Hours
- Get Funded as Quick as 72 Hours
- Applying Does Not Affect Your Credit
- Apply Online In Minutes
Lines of credit up to $250,000
- Average Yearly Revenue requirements: $120,000
- Minimum Credit Score: 625 FICO
- Minimum Time in Business to apply: 1 year
Select from wide range of funding options for your business
- Apply in minutes
- Transparent application process - no hidden fees
- Get funded in as little as 24 hours in some cases
- Rated A+ by the BBB
Unsecured business loans don’t require collateral. These loans are a great option for startups or other businesses who need access to capital but who don’t have any significant physical assets to put up as security. They can also be an option for business owners who do have capital, but want to avoid risking their personal or business assets by pledging them as collateral.
However, no collateral makes you more of a risk to lenders. That’s why unsecured loans usually come with a higher rate and have more stringent qualification requirements.
To help you find the best unsecured business loan, we've reviewed some well-known online lenders offering quick access to capital, minimal fees and lenient eligibility requirements. Read on to find out more.
Our Top Picks for the Best Unsecured Business Loans
The companies listed below are in alphabetical order.
- Biz2Credit: Best for Large Loans
- Bluevine: Quickest Approval and Fund Availability
- Fundbox: Best for Small Businesses
- Headway Capital: Best for Bad Credit
- National Funding: Best for Startups
- OnDeck: Best for Short-Term Loans
Best Unsecured Business Loan Reviews
Best for Large Loans: Biz2Credit
- Large loan amounts
- Approval in as little as 24 hours
- Low minimum credit score for working capital loans
- Funding as fast as 72 hours
- Discount on loans for eligible borrowers
- Requires $100k in annual revenue for working capital loans
- Must have 18 months in business and $250K in revenue for unsecured term loans
- High credit minimum for term loans
- Stricter eligibility requirements for term loans
- Term Loan Amounts
- $25,000 to $350,000
- Starting interest rate
- Not specified
- Minimum time in business
- 18 months
- Minimum Credit Score
- 575 for working capital loans, 650 for term loans
- Fees
- Origination fee, but no monthly fees
- Term Lengths
- 12 to 36 months
Why we chose this company: Biz2Credit offers several types of loans, including working capital, term loans and commercial real estate loans. With the latter, borrowers leverage commercial real estate to receive up to $6 million in funding.
Biz2Credit is somewhat stricter with eligibility requirements for its more sizable funding options. However, if you meet the requirements, you can receive a term loan of up to $500,000 or a CRE loan (with commercial real estate used as collateral) of up to $6 million.
For term loans, businesses need a score of at least 660 and more than $250,000 in annual revenue. Commercial real estate (CRE) loans have the same requirements, but you must also already own commercial property, as equity in the property is used as collateral.
Repayment for term pans is weekly or biweekly. For CRE loans, repayment is on a monthly basis, with interest-only payment options available.
Quickest Approval and Fund Availability: Bluevine
- Approval decisions in as little as five minutes
- Funds may be available as soon as 24 hours
- Available to businesses operating for only 6+ months
- Credit line replenishes as you make repayments
- Only pay interest on funds used
- High costs due to high rates and frequent payments
- Monthly revenue requirement of $10K or more
- Line of Credit Limit
- $5,000 to $250,000
- Starting interest rate
- Not specified
- Minimum time in business
- 2 years
- Minimum Credit Score
- 625
- Fees
- No monthly fees
- Term Lengths
- 6 or 12 months
Why we chose this company: Bluevine’s funding process is among the fastest on our list. The company can verify a borrower's eligibility in as little as five minutes and deliver same-day funding.
For a $15 fee, Bluevine also offers quicker transfers, ensuring funds are available in your bank account within hours. And unlike similar online lenders, which require more than a year of business operations, Bluevine accepts businesses operating for as little as six months but not more than a year.
Best for Startups: Fundbox
- Low credit score (600) and annual income requirement ($100K)
- Accepts applicants with six months in business
- Transparent about line of credit fees
- Option to adjust repayment plan each time you draw funds
- Applying does not affect your credit score
- Offers a relatively low maximum credit limit
- Only offers weekly payments unless you enroll in Fundbox Flex Pay for $99 per month
- Repayment terms may be too short for some business owners
- Line of Credit Limit
- $1,000 to $150,000
- Starting interest rate
- 4.66% - 8.99%
- Minimum time in business
- 6 months
- Minimum Credit Score
- 600
- Fees
- No monthly or origination fees
- Term Lengths
- 12 or 24 weeks
Why we chose this company: Startups seeking smaller amounts of capital quickly will find Fundbox to be an ideal option. Additionally, with Fundbox Flex Pay ($99 per month), business owners benefit from lower fees and the convenience of monthly payments instead of weekly ones.
Fundbox solely offers lines of credit. However, unlike competitors, it allows borrowers to apply for and withdraw funding directly from the Fundbox mobile app. The mobile app also shows fees upfront. Fundbox’s line of credit calculator also helps make Fundbox one of the most transparent and easy-to-use online lenders.
Read the full review of Fundbox Small Business Loans here. >>>
Best for Bad Credit: Headway Capital
- Applying won't affect your credit score
- Low minimum credit score requirement
- No compounding interest
- Doesn't require personal guarantees for loans under $50K
- Requires one year in business and $50K in annual revenue
- High rates
- Relatively low maximum credit limit
- Doesn't help you build business credit
- Line of Credit Limit
- $5,000 to $100,000
- Starting interest rate
- Not specified
- Minimum time in business
- 1 year
- Minimum Credit Score
- Not specified
- Fees
- Origination fee, 2% fee on every draw
- Term Lengths
- 12, 18 or 24 months
Why we chose this company: Headway Capital offers business lines of credit with some of the most lenient eligibility requirements, making it a good choice for borrowers with poor personal credit scores in the 560 range.
Headway Capital’s True Line of Credit offers more flexible terms than some competing online lenders, with longer-than-average weekly or monthly repayment terms. Borrowers are also encouraged to pay loans early, as there are no prepayment penalties. These features, coupled with Headway Capital’s fee transparency, can help first-time borrowers or new businesses stay in control of the funds they borrow.
Best for Small Businesses: National Funding
- Accepts applicants with six months or less in business
- Discounts for early repayment
- Funds may be available within 24 hours
- Equipment financing options
- Requires $250K in annual revenue
- High interest rates and daily or weekly repayment terms
- Loans only; doesn't offer lines of credit
- Term Loan Amounts
- $10,000 to $500,000
- Starting interest rate
- Not specified
- Minimum time in business
- 6 months
- Minimum Credit Score
- 600 for unsecured business loans
- Fees
- Not specified
- Term Lengths
- 4 to 24 months
Why we chose this company: National Funding offers unsecured small business loans (up to $400,000) and equipment financing (up to $150,000). The lender requires only six months in operation to qualify.
Unlike many competitors, National Funding offers larger unsecured small business loans for businesses that have been in operation for as little as six months. However, the company does require an annual sales minimum of $250,000.
National Funding’s equipment loans — which can be especially helpful for brick-and-mortar businesses looking to purchase equipment or expand — don't come with any upfront costs or require down payments.
Best for Short-Term Loans: OnDeck
- Apply in 10 minutes, and receive a decision the same day
- Dedicated, U.S-based advisor available six days a week
- Transparent pricing with SMART Box Capital Comparison tool
- Helps build business credit by reporting to credit bureaus
- Offers loyalty benefits
- Requires one year in business and minimum annual revenue of $100K
- Borrowing costs can be high
- Not available in South Dakota, North Dakota or Nevada
- Line of Credit Limit
- $6,000 to $100,000
- Term Loan Amounts
- $5,000 to $250,000
- Starting interest rate
- 52.6%
- Minimum time in business
- 1 year
- Minimum Credit Score
- 625
- Fees
- 0.00% to 4.00% one-time loan origination fee, $20 monthly maintenance fee LOC
- Term Lengths
- 3 to 24 months
Why we chose this company: OnDeck offers loans with business loan terms starting at three months, which is much shorter than many other companies we evaluated.
For businesses looking to avoid long-term debt, OnDeck might be a great fit. Terms length are on the shorter side: For loans, repayment terms are three to 24 months, and unsecured business lines of credit have 12-month terms.
Unlike most competitors, OnDeck only uses soft credit pulls that don't affect personal credit scores, and reports payments to business credit bureaus so borrowers can grow their business credit scores.
Other Unsecured Business Loans We Considered
Rapid Finance
- Wider variety of loan products than most online competitors
- Funds available in as little as 24 hours
- High customer satisfaction rates
- Lacks transparency regarding APR and fees
- Potentially high fees according to online sources
- Term Loan Amounts
- $5,000 to $1 million
- Line of Credit Limit
- $5,000 to $250,000
- Starting interest rate
- Not specified
- Minimum time in business
- Not specified
- Minimum Credit Score
- 550
- Fees
- Undisclosed
- Term Lengths
- 3 to 18 months for lines of credit, 6 to 24 months for term loans
Rapid Finance has many more products than competing online lenders while still offering the fast funding times, high loan amounts and lenient eligibility requirements that characterize alternative lenders. In addition to term loans and lines of credit, it offers merchant cash advances, SBA loans, bridge loans and invoice factoring.
Why it didn’t make the cut: Rapid Finance is a high-cost option with undisclosed fees and high rates for those with fair credit scores. Loan details are unavailable until a borrower applies, making it hard to compare with other lenders. This application process may also harm credit scores.
TD Bank
- Long-term lengths
- Larger loan amounts
- Same-day approval
- Funds available within two business days
- Requires one year in business and $250K in annual revenue
- Relatively high minimum credit limit
- Must apply in person for loans over $100K
- Operates physically in only 16 states
- Term Loan Amounts
- $10,000 to $1,000,000
- Line of Credit Limit
- $25,000 to $500,000
- Starting interest rate
- Not specified
- Minimum time in business
- Not specified
- Minimum Credit Score
- 660
- Fees
- Origination fee but no monthly fees
- Term Lengths
- 36 to 60 months for unsecured loans
TD Bank offers unsecured business loans, business lines of credit and SBA loans. It stands out for offering larger loan amounts and longer term lengths (up to five years) than other unsecured loan lenders. However, loans over $100,000 must be applied for at a physical location, which can be found in only 16 states.
Why it didn’t make the cut: To apply for a loan exceeding $250,000, you must visit a physical location, which is currently limited to only 16 states.
Unsecured Business Loans Guide
The following guide covers things to keep in mind when shopping for an unsecured business loan, including common loan products, average costs, and how to improve your loan approval odds.
What is an unsecured business loan?
An unsecured business loan does not require collateral (e.g. assets, such as real estate, inventory and savings). However, because no collateral is required, unsecured business loans may have higher interest rates and stricter eligibility requirements.
Additionally, unsecured loan lenders often mandate a personal guarantee from you and other business stakeholders. This is a guarantee that will hold each signatory personally accountable for the business debt. If you can’t pay back the loan, lenders might pursue legal action to seize personal assets.
How do unsecured business loans work?
Unsecured business loans work much like other kinds of loans. Lenders set requirements for eligibility, such as a minimum credit score and an annual income requirement. Companies typically also require a set amount of time in business.
You apply online, by phone, or, in some cases, in person at a branch, then await an approval decision. Once approved, funding could happen within 24 to 72 hours, depending on the business loan company in question. Funding could be a lump-sum payment or a line of credit from which you draw as needed.
From there, you’ll have to conform to the agreed-upon repayment schedule. Until your loan is repaid, you will pay interest and possibly fees, such as an origination fee.
Requirements for unsecured business loans
Requirements for unsecured business loans vary by lender, but some of the most common are:
- Good personal or business credit scores (above 620)
- A low credit utilization ratio
- Stable annual revenue (many require $100,000)
- Sufficient time in business (at least 12 months)
- A personal guarantee (a promise to repay your business loan)
Types of unsecured business loans
Types of business loans are vast, and small business owners can benefit from knowing the options available. Note that all types of unsecured business loans may carry additional fees, such as origination fees, interest, processing fees on MCAs or a fee on each withdrawal on a business line of credit.
Some examples of unsecured business loans:
- Term loans: Term loans provide borrowers a lump sum of money they must repay by the end of the loan term.
- Business lines of credit (LOC): A business line of credit works similarly to credit cards in that borrowers may draw funds as needed and repay them to borrow again. Startup business lines of credit are a popular type of LOC.
- Merchant cash advances (MCA): A business financing option where businesses receive a lump sum and repay it through a percentage of their future credit card sales.
- Invoice factoring: An invoice factoring company takes over a business’s outstanding invoices, and customers pay the invoicing factoring company directly. In return, business owners receive the total balance of invoices, minus any fees.
What is the average cost of unsecured business loans?
The average cost of unsecured business loans varies widely based on the loan product and the borrower's creditworthiness and borrowing history.
Generally, unsecured business term loans and business lines of credit offer low APRs to the most qualified borrowers. Otherwise, APRs for unsecured business loans can be among the highest in the lending market.
Additional costs and fees are also associated with many types of unsecured business loans and business lines of credit. These may include, but are not limited to, origination fees, interest, late payment fees, wire transfer fees, fast transfer fees, and fees per withdrawal on a line of credit.
How to choose the best unsecured business loans
Every business has unique financing needs. To find the right loan for your business, consider what you need capital for, how much you need to borrow, and your business's eligibility.
When you have a clear picture of your needs, compare loan products from different lenders to find the best unsecured business loan options offering competitive rates and low or no fees.
Eligibility requirements
Unsecured small business loan lenders typically consider personal credit scores and business records when determining eligibility. These can include bank statements, tax returns, business plans, revenue history and time in business. Requirements can vary widely by lender and may be a principal factor in determining which products are right for you.
Types of loans
The two most common unsecured business loans are term loans and lines of credit.
- Term loans provide borrowers with a lump sum of money they must repay by the end of the loan term.
- Business lines of credit work similarly to credit cards in that borrowers may draw funds as needed and repay them to borrow again.
Other types of financing, such as merchant cash advances and invoice financing, may work for your business too, but generally feature higher overall borrowing costs.
Loan amounts
Unsecured business loan amounts range from $1,000 to $1,000,000 or more. Amounts may vary by loan product and depend on the borrower's eligibility. Lenders that offer larger loan amounts generally have stricter eligibility requirements.
Repayment terms
Repayment terms for unsecured business loans range from a few months to a few years. Lenders may offer daily, weekly, biweekly or monthly payment schedules, but options may also depend on the loan product and the borrower's eligibility. More frequent payment schedules could mean higher repayment amounts, which may not be suitable for all businesses.
Fees
The total cost of a loan includes the principal loan amount and interest. Additional fees can include underwriting, origination, late payment, prepayment, credit draw, monthly maintenance and origination fees. You should always ask for fee details before committing to a loan.
Support and incentives
Lenders differentiate themselves by offering various forms of customer support and incentives. Some lenders may offer real-time customer support or advice about loan options. Others may offer loyalty incentives for repeat borrowers.
Some online lenders also waive prepayment penalties or offer early payoff discounts, both of which can save borrowers money.
How to qualify for an unsecured business loan
Qualifying for an unsecured business loan will depend on each lender's eligibility requirements. Alternative lenders, usually online companies, often offer fast funding and have more lenient eligibility requirements than traditional institutions.
Pros and cons of unsecured business loans
- Fast application and quick funding
- No collateral required
- Variety of options, including term loans, lines of credit and invoice factoring
- Borrowers with bad credit may find options
- Eligibility requirements (e.g. FICO score, annual income) may be higher than with secured loans
- Personal guarantee may be required, which means you're personally liable for any unpaid funds
- These options are usually available as secured loans, too; fees and interest rates are higher when the loan is unsecured
- Interest rates for bad credit borrowers are significantly higher
Alternatives to unsecured business loans
Alternatives to unsecured business loans are abundant, which is helpful for business owners who feel an unsecured business loan isn’t ideal for their business needs.
Other funding options available to business owners include:
- Business credit card: You can use a business credit card to pay for expenses. The best business credit cards will offer incentives (e.g. cash back) and low interest rates.
- Secured business loan: Collateral is required, but the best small business loans offer more favorable terms (interest rates, repayment plans) than unsecured loans.
- Crowdfunding: Platforms such as GoFundMe, Kickstarter and Indiegogo offer the opportunity to raise money from individuals who want to support your business. These platforms do take a percentage of funds raised.
- Angel investors: Online platforms like Wefunder make it easier to find angel investors for your business.
- Grants: You may be able to find a grant for your business through the Small Business Administration (SBA), a state-based grant program or through an organization that provides grants for specific industries and causes.
How to compare unsecured business loans
When comparing unsecured loan lenders, these are the most important factor to keep in mind:
- Eligibility requirements
- Types of loans
- Loan amounts
- Repayment terms
- Loan fees
- Customer support and incentives
Unsecured Business Loans FAQs
Is a small business loan secured or unsecured?
What is a personal guarantee on a business loan?
What happens if you default on an unsecured business loan?
How We Found the Best Unsecured Business Loans
When selecting the best unsecured business loan lenders, we took into account the following factors:
- Types of loan products offered: We favored companies that provide both business lines of credit and term loans, various term length options and repayment schedules, flexible qualification requirements, unique products, incentives or benefits, and no hidden fees.
- Customer experience: We prioritized companies that provide a streamlined online application process, fast approval and loan disbursement, and tailored customer support options.
- Reputation and transparency: We evaluated companies' reputations based on their Better Business Bureau and Trustpilot scores. We favored companies that demonstrated transparency regarding essential loan factors such as starting APR, eligibility requirements and fees.
Summary of the Best Unsecured Business Loans of 2024
The companies listed below are in alphabetical order.
- Biz2Credit: Best for Large Loans
- Bluevine: Quickest Approval and Fund Availability
- Fundbox: Best for Small Businesses
- Headway Capital: Best for Bad Credit
- National Funding: Best for Startups
- OnDeck: Best for Short-Term Loans