We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free - so that you can make financial decisions with confidence. The offers that appear on this site are from companies from which TheSimpleDollar.com receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. The Simple Dollar does not include all card/financial services companies or all card/financial services offers available in the marketplace. The Simple Dollar has partnerships with issuers including, but not limited to, American Express, Capital One, Chase & Discover.
Best Unsecured Business Loans for 2020
Ben Gran – Contributing Writer Last Updated: August 11, 2020
Unsecured business loans can be great resources to help your business grow. Whether you need help financing an upgrade or improvement or want to invest funds in scaling your business, business loans give you the funds and flexibility you need to succeed.
Bank and credit unions often offer the best rates and repayment terms when it comes to unsecured business loans. However, non-traditional lenders may also be a good option for those who have poor credit or don’t qualify for a loan from a traditional lender. When applying for loans, make sure to choose your research in order to end up with the best rates your qualify for.
Up to $250,000
1. For businesses organized as a limited liability company or corporation, we do not perform a hard credit pull at any point in our process, which means your credit score will not be impacted. For businesses organized as sole proprietors or general partnerships, we will only perform a hard credit pull after you receive and accept your offer.
2. The rate is a simple interest rate calculated from total repayments over 26 weeks.
3. Once approved, get funds deposited in your bank account in as quickly as a few hours if you choose our bank wire option ($15). Or, choose our free ACH transfer option which typically gets funds deposited the next business day, although it may take up to three.
*There are some industries we cannot serve (see list of restricted industries), as well as some industries and states impacted by the Coronavirus to which we are temporarily not lending. In addition, OnDeck does not lend to businesses in Nevada, North Dakota or South Dakota. OnDeck is no longer accepting new Paycheck Protection Program (PPP) loan applications. Registration terms and conditions apply. Instant Funding registration and withdrawals are currently supported from your desktop and the OnDeck mobile website. They are not currently supported in the OnDeck mobile app. Occasionally, transfer may take up to 30 minutes to complete due to potential Visa & bank processing lags. This benefit is available at no additional cost with a vast majority of major banks participating. Instant Funding is available for transactions between $1K-$10K.
1. Kabbage Checking account opening is subject to identity verification.
2. The annual percentage yield (“APY”) is accurate as of 7/15/20 and may change at our discretion at any time. The APY is applied to deposit balances on the funds within your primary Kabbage debit account and each individual Wallet. We use the average daily balance method to calculate interest.
3. Beginning January 1, 2021, Kabbage Payments customers will pay 2.9% + $0.25 per card not present transaction. There is currently a 2.5% payment processing charge per gift certificate purchase from our partners that facilitate the service.
We follow a rigorous editorial policy designed to keep our writers and editors independent. Articles may reference products from our partners, so here’s more information on
How we make money
The Simple Dollar is an independent, advertising-supported publisher and comparison service. The Simple Dollar is compensated in exchange for featured placement of sponsored products and services, or your clicking on links posted on this website. This compensation may impact how, where and in what order products appear. The Simple Dollar does not include all companies or all available products.
Lack of product variety causes Lending Club to fall short of being the best lender, but its funding model and streamlined application make it a great lending option for businesses.
2.6 / 5.0
SimpleScore LendingClub 2.6
Median APR 3
Loan Size 4
Product Variety 1
Lending Club is a peer-to-peer lender with an accessible application and competitive rates.
Lending Club is best known for its innovative status as a peer-to-peer lending platform. The lender offers unsecured business loans of up to $500,000, so they can help finance business projects both large and small. With rates starting at 4.99%, these loans are some of the most competitively priced in the industry. Eligible businesses should be at least one year old, and make over $50,000 per year. Lending Club does charge an origination fee of 3.49% – 7.99%, so it may not be the best fit for borrowers trying to steer clear of fees entirely. However, it still represents a great deal for borrowers who are able to qualify.
Business owners who want to stay away from lengthy, complicated SBA loan application processes will find solace in SmartBiz’s streamlined, simple online application. Couple that with great customer support, and here’s a lender well worth considering.
3.4 / 5.0
SimpleScore SmartBiz 3.4
Median APR 3
Loan Amount 4
Product Variety 3
SmartBiz enables small businesses to secure loans through the SBA, which is often recognized as the gold standard when it comes to business loans.
The main advantage of working with SmartBiz to secure a business loan is that they’re able to walk borrowers through the complicated process of applying for an SBA loan. Because SBA loans are so competitively priced, they’re difficult to secure and often require additional forms and paperwork. SmartBiz can walk business owners through every step of the process. Terms lengths for these loans range from 10 to 25 years, and borrowers can secure up to $5 million in funding. SmartBiz does charge an application fee of up to $3,000, and an SBA guarantee fee of 1.7% – 3.75%.
Best for veteran-owned small businesses – StreetShares
Average term lengths and loan amount land Street Shares with an average score. But its focus on veterans and small businesses, as well as competitive interest rates, give it an advantage.
3 months–3 years
4 / 5.0
SimpleScore StreetShares 4
Max Credit Line Amount 5
Draw Period 4
Street Shares offers an easy application process and a special focus on helping veterans secure business loans.
Like Lending Club, Street Shares is not a traditional lender but rather an innovative peer-to-peer lending organization. Borrowers can access loans of up to $250,000, with term lengths ranging from 3 to 36 months. Street Shares places a special emphasis on helping small business owners who are veterans to secure the funds they need to help their businesses succeed. The lender doesn’t charge a prepayment penalty, so borrowers can pay off their loan before the term length is up if they choose to.
Note: Street Share is only offering Paycheck Protection Loans to businesses at the moment and is not originating term loans.
Best for quick application process – National Funding
Despite charging an origination fee, National Funding’s competitive interest rates and wide variety of products make it a good lender for any type of business.
4 / 5.0
SimpleScore National Funding 4
Median APR N/A
Loan Amount 4
Product Variety 4
National Funding offers competitively priced loans with a quick and easy application process that can have funds deposited in your account within a day.
National Funding offers unsecured business loans of up to $500,000, making it a good fit no matter how big or small your business project is. Because the lender looks at more than just your credit score and business history, it can create a term loan customized to each business need. The application process is quick and easy, and if you’re approved for a loan you may be able to receive your funds within 24 hours. However, National Funding does charge an origination fee of 2%, so keep that in mind when comparing this lender.
Funding Circle helps business owners by placing a special emphasis on helping small businesses access unsecured loans.
3 months–10 years
3.2 / 5.0
SimpleScore Funding Circle 3.2
Median APR 3
Loan Amount 4
Product Variety 1
Funding Circle is another peer-to-peer lender offering unsecured business loans. This lender focuses on lending to small businesses with loans of up to $500,000, 6% flat interest rate and up to 10 years of repayment terms. Funding Circle charges an origination fee of 3.49% to 6.99%, but many other lenders also charge this fee. With a Funding Circle SBA loan, businesses can upgrade their operations, consolidate business debt and pay for upfront costs like inventory and equipment. Its streamlined application.
Low loan amounts limit American Express from a better score, but its two-in-one business financing shop provides competitive, convenient loans and credit cards to business owners.
3.4 / 5.0
SimpleScore American Express 3.4
Median APR 4
Loan Amount 2
Product Variety 2
American Express is a good choice for an unsecured business loan if you already use it for its credit card offerings.
American Express offers unsecured business loans to borrowers who are already card-carrying members. Loan amounts range from $3,500 to $75,000, with term lengths from six to 36 months. Members can apply to prequalify for a loan, which won’t affect their credit score even if they’re not approved. With rates starting going as high as 19.97%, it isn’t quite as competitive as some other lenders, but still a good option for price-conscious borrowers who appreciate the ease and convenience of working with a company they’re already familiar with.
With great product variety, many businesses can find a funding solution through Blue Vine. Whether you want upfront funding from invoices or a non-specified-purpose loan, you’ll likely find what you need with this lender.
Up to $5 million
N/A / 5.0
SimpleScore BlueVine N/A
Max APR N/A
Loan Amount N/A
Product Variety N/A
BlueVine offers competitive business term loans, but its strength lies in invoice factoring loans.
BlueVine is a lender that allows businesses to access capital through a process known as invoice factoring. If you have outstanding invoices that haven’t yet been paid, BlueVine allows borrowers to leverage those invoices in order to borrow funds up to $5 million. Businesses receive 85% to 90% of the outstanding invoice amount, then repay the invoice factoring loan starting at 0.25% per week for 6 or 12 months.
It’s unsecured business term loans are also competitive, with rates starting at 4.8% and loan sizes up to $250,000. Funding is quick, but repayment is short — only up to 12 months to repay a loan. Keep that in mind when considering this lender.
Note: BlueVine is only offering Paycheck Protection Loans to businesses at the moment and is not originating term loans.
What is an unsecured business loan?
An unsecured business loan is a loan that isn’t backed by collateral, such as a house, vehicle or financial accounts. When you take out a secured business loan, you run the risk of losing your collateral if you fail to make payments. Because unsecured business loans don’t have any collateral associated with them, you won’t lose the property if you’re unable to pay back the loan. This usually means that unsecured business loans come with higher interest rates since they pose a greater risk to lenders.
Unsecured business loans can help you to secure the funds you need to help your business grow. Whether you’re planning a move, want to invest in marketing and expansion, or just need a little financial boost to give your business the leverage it needs to succeed, unsecured business loans are a great option if you need a little extra cash for your business. Business loans can include both short-term and long-term loans.
Check Your Business Loan Rates
View our top-rated lenders and find the best rates today. It’s quick and easy.
In order to qualify for an unsecured business loan, you should:
Research loan options: Find out what loans you might qualify for and which meet your specific needs.
Gather your business information: Many lenders require information about your business, including how long you’ve been in operation and how much money you make in a year.
See if you prequalify: Some lenders allow prospective borrowers to find out if they prequalify without harming their credit score.
Apply for loans: Apply for the loans you think are the best fit, and try to secure the most competitive rates possible.
Too long, didn’t read?
Getting an unsecured business loan is an important tool many business owners use to buy inventory, equipment and make long-term investments in the growth of their companies. It’s a good idea to start with your bank first, but if you can’t get approved for a bank loan, or if you need fast cash, there are a variety of other lenders offering flexible financial solutions and competitive rates.
We welcome your feedback on this article and would love to hear about your experience with the business loans we recommend. Contact us at firstname.lastname@example.org with comments or questions.
We’ve created the SimpleScore to help you objectively compare products and services here at The Simple Dollar.
Our editorial team:
Identifies five factors to compare across each brand
Determines the rating criteria for each factor
Calculate an average of those five factor scores to get one SimpleScore™
We break down each of these five factors and their rating criteria for our review of the best auto loan companies of 2020.
Why do some brands have different SimpleScore on different pages?
Some brands offer a variety of financial products, which is why they have different SimpleScores on different pages. We rate individual products that brands offer — not the brand as a whole.
For instance, in our American Express personal loans review we rated the company a 4.25 out of 5 based on rates, loan amount, customer satisfaction, customer support and fees. In our review of the best small business loan rates, American Express earned a 3.4 out of 5 SimpleScore based on its business loan product. By tailoring our SimpleScore to each financial solution, we’re able to give you a more accurate view of each brands’ services and how they compare to competitors’ products.
Lenders with a lower median APR are awarded higher scores — because even if you’re APR is average, your business is not.
Maximum loan size
Lenders that dole out loans with high maximums are also rewarded with higher scores. It takes money to run a business, and businesses need access to as much capital as it takes.
Need more than just a business loan? Lenders that offer more than one type of financial product for businesses score higher than others that don’t.
We gave out higher scores to lenders that have the following subjects covered in their blogs: loans, marketing, employee and staff, and credit or finance resources.
Fees can add up fast and eat into operating costs –– that’s why we give a higher score to lenders that have fewer fees.
Andrea Perez is an editor at The Simple Dollar specializing in personal finance. Prior to that she specialized in digital marketing content for online learning websites. She holds a master’s degree in journalism and media studies from the University of South Florida.