December 6, 2024

Personal Economic Consulting

Smart Investment, Bright Future

4 Best Unsecured Business Loans of 2024

4 Best Unsecured Business Loans of 2024

An unsecured business loan allows you to access financing for your business without providing collateral, like business equipment, real estate or cash. Generally, lenders offer this type of loan based on your credit health and business history. You can use an unsecured loan to support your small business in many ways, from getting cash for inventory purchases to covering payroll.

CNBC Select analyzed small business loan lenders to determine which unsecured business loans are best for different needs. (See our methodology for more information on how we made this list.)

Best unsecured business loans

Best for variety of financing options

Credibly

  • Types of loans

    Long-term loans, working capital loans, business line of credit and merchant cash advance

  • Better Business Bureau (BBB) rating

  • Loan amounts

  • Terms

  • Minimum credit score needed

  • Minimum requirements

    Must have been in business for at least six months and have average monthly revenue of at least $15,000

Pros

  • Offers multiple options for small business financing
  • Can get approved within four hours
  • Low minimum credit score requirement
  • Provides loan amounts of up to $600,000
  • Funds deposited as soon as the same business day
  • Considers overall business health as an approval criteria

Cons

  • Requires an average monthly revenue of at least $15,000

Who’s this for? Credibly offers multiple business loan options to suit a multitude of needs. You can potentially choose from a merchant cash advance, a term loan and a business line of credit. With a credit score requirement of just 500, it’s also a great pick for those with lower credit scores.

Standout benefits: Same-day funding is available for certain types of financing. Plus, you can pre-qualify without a hard credit pull and see if you’re approved in less than four hours.

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Best for line of credit

BlueVine Business Line of Credit

  • Annual Percentage Rate (APR)

  • Loan amounts

  • Terms

  • Credit needed

  • Early payoff penalty

  • Maintenance fees

  • Late fee

    5% of the missed repayment (minimum of $35)

Pros

  • Open to borrowers with fair credit (minimum 625 score)
  • High loan maximum
  • Quick funding
  • Few fees
  • Option to pay monthly or weekly

Cons

  • Requires at least 24 months in business which may not suit newer businesses
  • Requires at least $40,000 in monthly revenue
  • Not available for all industries or in all states

Who’s this for? A business line of credit might be a better choice if you prefer a credit line you can borrow against when you need it. Bluevine provides business credit lines of up to $250,000 — and you may qualify for a credit limit increase as your business grows. It considers applicants with credit scores as low as 625.

Standout benefits: Bluevine doesn’t charge any fees for opening, maintaining or closing a business line of credit. There are also no penalties for prepayment. The application process is quick, and you can receive the funds within hours if you opt for the bank wire option.

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Best for short-term loans

Funding Circle

  • Types of loans

  • Better Business Bureau (BBB) rating

  • Loan amounts

  • Terms

  • Minimum credit score needed

  • Minimum requirements

    In business at least 2 years, no bankruptcies within the last 7 years

Pros

  • Top-tier A+ rating with the BBB
  • No prepayment penalties
  • Funding in as little as 48 hours

Cons

  • You have to be in business at least 2 years to qualify

Who’s this for? With a term loan from Funding Circle, you can get funds for almost any business purpose and receive money within two business days. You may be able to borrow as much as $500,000. Plus, the lender doesn’t have a minimum revenue requirement. Note, however, that Funding Circle also provides secured loans — and long-term loans (those longer than three years) may require collateral. For that reason, we recommend this lender for shorter term lengths.

Standout benefits: With Funding Circle, you can see if you qualify without a hard credit check. If you’re approved, you can get the funds in two days. Additionally, the lender charges no prepayment penalties.

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Best for microloans

Kiva

  • Types of loans

    Peer-to-peer crowdfunded loan

  • Better Business Bureau (BBB) rating

  • Loan amounts

  • Terms

  • Minimum credit score needed

    No minimum credit score required

  • Minimum requirements

    You must be 18, live in the U.S., use this loan for business purposes, not currently in foreclosure, bankruptcy or have any liens, and have a small number of your friends and family willing to make a loan to you (Nevada and North Dakota residents are not ineligible)

Pros

  • Ability to borrow with no interest
  • Loans are geared toward borrowers who are unbanked and have trouble qualifying for financial products
  • Ability to market your product to 1.6 million lenders on Kiva

Cons

  • You need to prove your creditworthiness by inviting friends and family to lend to you
  • It can take a while to receive your loan since investors need to raise money
  • No BBB rating

Who’s this for? Kiva can be an excellent option if you need to borrow less than $15,000. This crowdfunding platform is an especially good solution for a young business, since it offers a 0% interest rate and allows you to demonstrate your creditworthiness by inviting friends and family to lend to you.

Standout benefits: Kiva doesn’t have traditional business and credit score requirements.

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More on our top unsecured business loans

Credibly

Bluevine

Funding Circle

Kiva

FAQs

How do you qualify for an unsecured business loan?

To qualify for an unsecured business loan, you’ll typically need to meet revenue and credit requirements, which vary by lender and loan type.

Can a business borrow money without collateral?

It’s possible to get a business loan without collateral, but unsecured loans often come with stricter approval requirements.

How hard is it to get an unsecured business loan?

You’ll typically need to have an established business and solid credit to get an unsecured business loan — otherwise, it may be challenging to get approved.

Can I get a business loan with a 500 credit score?

It’s possible to find a lender who works with borrowers with bad credit — however, you may find it easier to qualify for a secured business loan.

Bottom line

An unsecured business loan is a popular financing option since it doesn’t require collateral. This type of financing can help with many business needs, but you’ll probably need to demonstrate healthy credit and revenue to get approved. Make sure to pre-qualify with a few lenders to ensure you’re getting the most favorable terms.

Why trust CNBC Select?

Our methodology

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.


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