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Updated July 10, 2025
What to know first: It can be challenging for business owners to secure a business loan with bad credit, especially from traditional banks. But even though your options are limited, it’s possible to find a lender that will approve you with a little research.
If you’re looking to get a business loan with a less-than-perfect credit score, Bankrate is here to help you find funding.
Bad credit business loans are often available to business owners with personal credit scores that are considered bad to fair (FICO scores of 300 to 669). You can find a variety of business loans for bad credit, everything from short-term loans to merchant cash advances to certain SBA loans.
These types of loans do come with downsides for a bad credit borrower, however. Lenders often offer lower loan amounts, charge higher fees and interest rates and have shorter or more aggressive repayment terms than traditional business loans. As well, they may require you to secure the loan with collateral or have higher revenue requirements.
Even so, if you have a bad credit score and need funding for your business, Bankrate can help you explore your options. We’ve named the best bad credit business loans below along with some tips to help you find the right loan for you and your business.
The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where and in what order products appear. This table does not include all companies or all available products. Bankrate does not endorse or recommend any companies.
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Disclosures:
*Rates, terms, & payment structure may vary by state and lender. Rates shown reflect an average fixed monthly percentage. A hard pull may be performed based on the product and lender, applicant will be notified if a hard pull is required for approval. Decision and funding time are subject to applicant’s submission of all requested approval and closing documents. Minimum qualifications listed are not reflective of all programs, rates and terms may vary based on applicants qualifications. By supplying us with your information, you authorize Streamline Funding LLC dba Fundible and prospective third-party funding providers to contact you at the numbers you provide (including mobile) during any step of this application, via phone (including automated telephone dialing systems, prerecorded, SMS and MMS means) even if you are on a Do Not Call Registry. You are not required to agree to be contacted in this manner to apply with Streamline Funding LLC dba Fundible.
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*Factor rates are included in your daily estimate to simplify remittances and account monitoring. Best factor rates available to merchants with excellent credit and financial strength.
**Some products are made available through Credibly’s network of external funding partners
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Bankrate evaluated multiple lenders to choose which ones have the best offers for business owners with sub-prime credit. Business owners can then compare options based on their business needs.
Click "get personalized rates" and fill out some information to see what lenders you may be eligible for as well as preliminary loan details.
You can apply for any loan you qualify for that you've been matched with through Bankrate. You'll then be able to receive funding and manage your loan through your chosen lender.
Before you sign on the dotted line of a new loan, compare options from multiple lenders. Some loans are better for startups with no or bad credit, while others are a better fit for companies with higher monthly revenue. Bankrate takes a deeper dive into the lenders from above to help you find the best bad credit business loan.
Fundible offers a wide variety of financial products, many of which cater to the needs of small businesses with bad credit. And they only require a minimum personal credit score of 580 to qualify. With reasonable interest rates and fast funding, it’s easy to see why Fundible is our 2025 award winner for best small business lenders for those with bad credit.
To qualify for a loan with Fundible, you’ll need a personal credit score of at least 500. You will also need a minimum monthly income of $8,000 a month ($96,000 annually).
Business Credit Score: N/A
Personal Credit Score: 500
Personal guarantee requirement: No
Minimum time in business requirement: 6 months
Minimum business annual revenue: $96,000
With a personal credit score of just 550 or above, you can qualify for a loan through Businessloans.com with the potential to borrow up to $1 million in as little as one business day. And you can also compare loan offers and information from within the same window.
Those seeking a loan through Businessloans.com will need to have been in business for at least six months and have an annual business revenue of $100,000 or more. They will also need a personal credit score of at least 550.
Business Credit Score: N/A
Personal Credit Score: 550
Personal guarantee requirement: Yes
Minimum time in business requirement: 6 months
Minimum business annual revenue: $100,000
Backd offers a streamlined application process and funding in as little as one business day. And if you have bad credit, the lender only requires a personal credit score of at least 600. If you qualify, you may be able to borrow as much as $750,000 with Backd.
You will need to have been in business for at least one year if you want capital from Backd. You will also need at least $300,000 in annual revenue and a personal credit score of at least 600.
Business Credit Score: N/A
Personal Credit Score: 600
Personal guarantee requirement: Yes
Minimum time in business requirement: 2 years
Minimum business annual revenue: $300,000
Credibly offers quick prequalification for prospective borrowers. This, along with favorable terms and easier qualification terms, make Credibly a highly attractive option.
Credibly requires applicants to have a personal credit score of 500 or better. And while you need to have at least $300,000 in annual revenue, you only need to be in business for six months to qualify.
Business Credit Score: N/A
Personal Credit Score: 550
Personal guarantee requirement: No
Minimum time in business requirement: 6 months
Minimum business annual revenue: $300,000
If you are seeking a line of credit and have poor credit, Fundbox could be a compelling choice for you. The company requires a personal minimum credit score of just 600. They also have a quick application process that can give you a credit decision in as little as three minutes.
Applicants looking for a loan will need a minimum credit score of 600, which is higher than some other options on our list. However, annual revenue requirements are relatively low at $30,000. You also need to be in business for just three months or longer to qualify.
Business Credit Score: N/A
Personal Credit Score: 600
Personal guarantee requirement: No
Minimum time in business requirement: 3 months
Minimum business annual revenue: $30,000
OnDeck is our 2025 award winner for best lender for startups because of their fast funding, variety of repayment terms and relaxed eligibility requirements. In fact, applicants can get approved for a loan with OnDeck with a minimum credit score of just 625.
If you want a loan with OnDeck, you’ll need to have been in business for least a full calendar year and a revenue of $100,000 or more. You will also need a credit score of 625 or more, which is higher than other options on our list.
Business Credit Score: N/A
Personal Credit Score: 625
Personal guarantee requirement: No
Minimum time in business requirement: 1 year
Minimum business annual revenue: $100,000
While its time-in-business and revenue requirements are higher than other lenders on our list, Triton Capital offers large loans to businesses with poor credit. In fact, the company only requires a minimum business credit score of 600.
Both your business and personal credit score will have to be at least 600 to be eligible for a loan from Triton Capital. You will also need an annual revenue of at least $350,000 in annual revenue and a minimum of two years in business.
Business Credit Score: 600
Personal Credit Score: 600
Personal guarantee requirement: No
Minimum time in business requirement: 2 years
Minimum business annual revenue: $350,000
Kiva is a lender that specializes in microloans, offering loans as low as $1,000. As long as you operate in an approved industry, Kiva can approve a wide range of different companies and financial situations.
Kiva offers smaller loans than other lenders on our list, and they do not disclose a strict criteria for eligibility. In fact, Kiva could be seen as more of a crowdfunding platform of sorts than a traditional lender. You can go to their website and ask to borrow funding free of charge.
Business Credit Score: N/A
Personal Credit Score: N/A
Personal guarantee requirement: No
Minimum time in business requirement: N/A
Minimum business annual revenue: N/A
The popular consumer payment app also offers a wide range of products for small businesses, including loans. In fact, small businesses can borrow up to $300,000 in as quickly as one business day if they are approved. Best of all, they only require small businesses to have a minimum annual revenue of at least $15,000 to qualify.
PayPal does not specify their credit score requirements for small business loans, but they are known to have lenient requirements who those who have applied in the past. They require an annual revenue minimum of just $15,000. Businesses have to have had a Paypal business or premier business account for at least 3 months and processed at least $15K in sales over the past 12 months.
Business Credit Score: N/A
Personal Credit Score: N/A
Personal guarantee requirement: No
Minimum time in business requirement: 3 months
Minimum business annual revenue: $15,000
Accion Opportunity Fund specializes in serving companies based in underserved communities. In addition to fair lending terms, the company also offers business coaching and networking with other businesses in your community.
Accion Opportunity Fund aims to lend capital to businesses in underserved communities, so it will be helpful to make a proper case for your business during the application process. On top of that, you will need to have been in business for at least one full year and have at least $50,000 in annual income for your business.
Business Credit Score: N/A
Personal Credit Score: N/A
Personal guarantee requirement: No
Minimum time in business requirement: 1 year
Minimum business annual revenue: $50,000
Bank of America requires a higher personal credit score than other lenders on our list. However, it also carries the benefit of being a large traditional bank with physical locations in most of the country. Therefore, you can get in-person help with your loan application that you can’t get with online-only options.
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Applicants looking for a loan from Bank of America will need a personal credit score of at least 670 to qualify. However, they only need to have been in business for six months at the time of their application.
Business Credit Score: N/A
Personal Credit Score: 670
Personal guarantee requirement: No
Minimum time in business requirement: 6 months
Minimum business annual revenue: $50,000
Bad credit business loans are designed for companies with poor or limited personal or business credit. Eligibility requirements for bad credit loans are typically more relaxed than traditional loans. Some lenders offer loans to small businesses with personal credit scores as low as 500.
Although it can be easier to qualify for bad credit business loans, keep in mind that they tend to have higher interest rates and fees, since the lender is taking more risk. They are also likely to require you to sign a personal guarantee.
Bankrate’s list of lenders can help you get a quick look at the requirements and get an idea of which lender is best for you.
What a lender considers to be bad credit depends on the scoring model they use. For personal credit, a FICO score of 300 to 580 is considered bad credit; however, many traditional lenders that offer the most favorable terms want to see a credit score of 680 or above.
Lenders typically place more emphasis on the personal credit score of the business owner, or anyone who is personally guaranteeing the loan, though business credit scores can be a factor as well. Depending on the scoring model, business credit scores may range from 0 to 100, with scores of 0 to 49 indicating a high-risk borrower.
Business loans for bad credit borrowers work similarly to any other loan. You submit an application and any documentation requested by the lender. Once approved, you can use the loan funds for business purchases. You then repay the bad credit business loan over a set time period with interest rates and fees.
Depending on the lender, underwriting for a bad credit business loan may take longer, and the lender is more likely to ask for supporting documentation that shows your ability to repay the loan. If you opt for a secured loan over an unsecured loan, you’ll need an asset of value as collateral, such as equipment or real estate. Unsecured loans don't need collateral but are aimed at companies with strong credit.
A lender will also request a list of documents that includes things like profit and loss statements, recent tax returns and financial projections:
Business loan scams
When you’re getting any type of loan, especially one for businesses with poor credit, you should be on the lookout for scams, malicious actors and bad deals.
Some red flags to keep an eye out for are:
Improving your business credit score requires considerable adherence to strict financial decisions. You need to take a close look at all the factors impacting your credit score and make a conscious effort to improve them. This includes your payment history, length of credit history, amount of debt, amount of new credit and more. In practice, pay your bills on time, keep your credit utilization low, ask vendors to report payments, and always monitor your credit score.Emmanuel Nyame, CEO of Twelvenets
Getting a small business loan with bad credit can take more time and effort than applying for one with good credit. Here’s what it involved.
Use Bankrate’s business loan calculator to project your monthly payments and how they factor into your current finances. Make sure to account for origination and other fees that the lender will add to that amount. Budget for an amount that will cover your needs while making sure you can afford the monthly payments.
If you have some time before you need funding, look at your personal and business credit reports to identify anything you can improve. You may come across errors that can be corrected, or pay down as much debt as you can to try and boost your score.
You might be able to get a better loan with some strategies:
Look for business lenders that are willing to work with business owners who have poor credit and narrow down your options based on eligibility requirements, interest rates and fees. Many online lenders will post their minimum requirements on their websites. If you have questions about a lender’s requirements or other loan features, you can contact the lender for more information.
Bankrate Insight
Many business loans for bad credit borrowers charge factor rates like 1.10 or 1.40 instead of interest rates. These factor rates get applied to the entire loan upfront and often convert into high interest rates.
For example, a factor rate of 1.30 converts to a 20 percent annual percentage interest rate (APR) for an 18-month loan. For a $50,000 loan repaid over 18 months with a factor rate of 1.30, you’d end up paying $15,000 in interest versus about $8,287 for the same loan with interest charged as an APR.
There are many types of business loans for borrowers with bad credit. Some of these loans are secured or have automated repayment plans, which may make them easier to qualify for than unsecured loans.
SBA loans are loans partially guaranteed by the Small Business Administration. While many SBA loans require higher credit criteria, some types of SBA loans have relaxed eligibility requirements. This includes 7(a) loans through Community Advantage Lending Companies and SBA microloans. Though it can take time to get approved for these loans, the interest rates are lower than standard business loans open to borrowers with bad credit.
Business term loans provide a lump-sum payment upfront that must be repaid over a fixed period. Some term loans are short and have repayment terms ranging from one to two years. Medium- and long-term loans may range from three to 10 years. Lenders may offer you a short-term loan to help mitigate the risk of lending to a bad-credit borrower.
Microloans are term loans offered in small amounts. Though there isn’t a set standard, SBA microloans offer loans for $50,000 or less. They’re often easier to qualify for than larger loans because the small loan size poses less risk to the lender. Many businesses use them for startup costs.
Lines of credit are usually revolving lines of credit, similar to business credit cards. This type of financing gives you the flexibility to draw funds multiple times up to the credit limit, and you can withdraw funds any time during the draw period.
You can get approved for a line of credit and wait to use the funds until you need them. Some lines of credit have variable interest rates, which may make repayment less predictable than other loans.
Equipment loans work similarly to term loans by providing a lump sum and repayment terms typically over one to five years. But this loan uses the equipment you’re financing as collateral to secure the loan. Because it’s secured, it’s easier for bad credit businesses to qualify for it. It can also offer higher loan amounts and lower interest rates than unsecured loans.
Invoice financing allows you to free cash that’s tied up in unpaid customer invoices by using them as collateral on a small business loan.
Once your clients pay their invoices, you repay the lender, plus a fee. Invoice financing loans can be easier to qualify for if you have bad credit because lenders are more concerned with the credit score and repayment history of your clients.
As with any type of financing, business loans with bad credit have benefits and drawbacks to consider.
While most lenders won’t offer you a traditional business loan with no credit check, some lenders offer loans with no credit check in the form of a merchant cash advance, invoice factoring or buy-now-pay-later (BNPL) financing.
These financing options allow you to get funding without a credit check by relying on future revenue streams, or by offering fairly small loans. With a merchant cash advance or invoice financing, you promise to pay back a certain portion of the future sales and invoices you make, along with fees and interest.
While this allows you to access funding without a credit check, lenders typically charge a much higher interest rate than traditional loans, and often have higher revenue requirements. It will also limit your revenue for the immediate future.
Some lenders offer pre-approval using a soft credit check, which doesn’t impact your credit score. However, the lender will eventually run a hard credit check when you officially apply, which means you can’t avoid a credit check if you decide to go through with the loan.
Many lenders offer business loans for bad credit. The right one for you will depend on the type of loan you need and who offers the best rates, terms and features. Make sure to shop around before accepting any offer.
If you aren't sure that a bad credit business loan is right for you, consider these alternatives:
Similar to invoice financing, invoice factoring helps you free up cash that’s restricted by unpaid customer invoices. Instead of using these invoices as collateral on a loan, you sell them to a factoring company at a discount in exchange for a lump sum of capital. The company then takes over collecting the invoices from your customers.
Merchant cash advances provide upfront cash to help a company meet short-term needs. The business then repays it automatically by sending a percentage of its debit and credit card sales to the lender. This is often one of the most expensive forms of business financing and can lead to a cycle of debt if the business owner is unable to pay back the debt quickly, so it’s best used as a last resort.
If your funding needs are revolving or you don’t need a large amount of money, you may consider a business credit card for bad credit. In addition to giving you access to money, business credit cards can provide rewards and build your business credit along the way. Make sure you have a plan to pay off what you’ve charged.
Crowdfunding campaigns can help you raise money by having many people offer small amounts. You usually pitch your business for funding using a crowdfunding platform like Kiva or Kickstarter. If you have a product idea, this can be a good way to pre-sell the product, get money from interested buyers and use that cash to start your business and produce the product they want to buy.
Small business grants can be competitive, but they’re a source of funds that you won’t have to repay, and therefore don’t require a credit check. Most grants come from the federal, state or local government, though you can find some with large corporations. You have to meet each grant’s criteria to apply, such as the type of business or customers you serve.
It depends on the lender, but you could be eligible for a bad credit business loan with a credit score as low as 500. Many lenders stay in the mid-500 to 600 range.
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Access to small business funding is a challenge for many business owners. Rate hikes and bank turmoil have led to lenders tightening credit standards and eligibility requirements. This can make it difficult for startups, bad-credit borrowers and business owners in underserved areas to get approved for small business loans.
Our experts consider several factors in this category and award higher scores to lenders that offer flexible loan amounts, fast approval and funding and inclusive time in business and annual revenue requirements.
The affordability of a business loan often depends on a business owner's financial profile. A business with high revenue and a flexible budget will likely be able to afford most loan options. Businesses considered high risk, such as startups or those with bad credit, may struggle to find loans with affordable interest rates and reasonable fees.
We consider a business loan affordable if the payments are manageable, you have the lowest possible rate based on your creditworthiness and there are minimal fees. Lenders that have lower rates, offer rate or fee discounts and have minimal fees receive higher scores.
A good customer experience requires a lender to be transparent, efficient and responsive. Reputable lenders that value their customers are easy to communicate with, responsive to your questions and concerns and willing to go the extra mile to make sure you have a positive experience for the life of the loan.
Lenders offering online accounts and applications and a range of customer support availability score higher in this category.
While the Truth in Lending Act (TILA) protects consumers against unfair or harmful lending practices, it doesn’t apply to business loans. This can make it harder to get straightforward and upfront information on loan costs when comparison shopping. We score lenders that make it easy to find rates and fees, as well as eligibility and credit score requirements, higher than those who do not disclose information.
Loan flexibility is finding a loan to meet your needs, even if you don’t have high annual revenue, several years in business or the best credit score. Loan flexibility can look like lenders that offer multiple lending products, variety in loan terms or unique options to give business owners the opportunity to fund their businesses in a way that works for them.
Lenders scoring high in this category offer varied products and services to cater to all types of borrowers and businesses.
We use primary sources to support our work. Bankrate’s authors, reporters and editors are subject-matter experts who thoroughly fact-check editorial content to ensure the information you’re reading is accurate, timely and relevant.
“Sizing the CDFI Market: Understanding Industry Growth.” New York Federal Reserve Bank. Accessed on September 6, 2024.