If you’re on the search for business financing, you have more options than ever before.
Traditional routes like a bank or credit union will give you the best interest rate, so that’s a smart first try. But what if you aren’t successful at a traditional lender? Where do you go next?
Fortunately, there are new alternatives popping up everywhere.
Consider peer-to-peer lenders, such as Lending Club. This option is best for companies that have been in business for at least one year and generates at least $50,000 in annual revenue. Their lending criteria tends to be less stringent than a traditional lender’s criteria. Also, it offers flexible repayment terms. The interest rate can vary heavily, usually in the range of 9.8% to 35.7%. Those applicants with strong personal credit fair the best.
Funding Circle or On Deck
If you don’t meet the revenue requirements of something like Lending Club, you could try Funding Circle. Or if your personal credit score isn’t as high as you’d like it to be, you might look into On Deck. Take the time to compare lenders and financing options to find the best fit for your situation. Term loans, small business lines of credit, and personal lines of credit are all options to consider depending on your financing needs.
Unique Lending Options
If you’re an online business, Paypal and Square have unique lending options that require no credit check. Paypal Working Capital provides funding based on sales volume. It is up to a maximum loan amount of 15% of sales or $85,000 annually. A portion of sales is then used to pay your loan balance. Square Capital works similarly.
While online small business financing typically comes with a double-digit interest rate, their more generous lending criteria and flexible repayment options make them worthy of consideration for many small business owners.
If you need help selecting the right option for your business please, contact us today.