American Express® Business Line of Credit vs. OnDeck: Which Lender Is Best for Your Business?

For businesses seeking a lender that offers an online application and convenience, American Express Business Blueprint™ (formerly Kabbage) and OnDeck are two good options.

Qualifying for a loan at a traditional bank takes time and requires you to have great credit and, often, collateral. These two online business lenders have a streamlined application process with minimal paperwork and higher approval rates. In exchange, American Express and OnDeck have higher borrowing costs than banks.

Here’s a side-by-side comparison of American Express and OnDeck, and more details to help you find the best small-business loan.

American Express is a good option if you:

• Need cash for working capital.

• Have average personal credit.

• Prefer to make monthly payments.

American Express Business Blueprint™ offers the American Express® Business Line of Credit*, and each draw requires repayments over six, 12, 18 or 24 months. Line of credit amounts range from $2,000 to $250,000. (Read our American Express® Business Line of Credit review.)

Minimum qualifications: American Express requires a minimum FICO score of at least 660 at the time of application, an average monthly revenue of at least $3,000 and that you started your business at least a year ago. It's important to note that the required FICO score may be higher based on your relationship with American Express, credit history, and other factors, and that all businesses are unique and are subject to approval and review.

You also need to have a business checking account or online payment platform such as PayPal or QuickBooks.

Costs: Instead of traditional interest, American Express charges monthly fees depending on your loan's term. Each month, you pay a percentage of the amount borrowed — the principal — plus a fee.

Total monthly fees incurred over the loan term range are:

Best uses: The American Express® Business Line of Credit is a good option for accessing working capital and covering day-to-day expenses, such as payroll and inventory.

» MORE: Best startup business lines of credit

OnDeck is a good option if you:

• Need fast cash for a large expansion or working capital.

• Need to borrow more than $150,000.

• Are comfortable making weekly or daily payments.

OnDeck’s term loans range from $5,000 to $250,000 and provide a lump sum of cash at closing that you repay daily or weekly over up to 24 months.

Credit lines go up to $100,000 and are repaid weekly. (Read our OnDeck review.)

Minimum qualifications: To qualify for a term loan, you need to have been in business for at least 12 months, earn a minimum of $100,000 in annual revenue, have a personal credit score of 625 or better, and have had no personal bankruptcies within the past two years.

For the line of credit, you need to be a majority owner of the business with a minimum personal credit score of 625. The requirements for annual revenue and time in business are the same as for OnDeck’s term loans.

For both products, you’ll sign need to sign a personal guarantee. However, unlike OnDeck’s term loans, its lines of credit don’t require a lien on your business’s assets.

Speed: The application process is simple and takes about 10 minutes. You receive a loan decision within minutes and access to funds in as fast as the same day for loans and instantly for lines of credit withdrawals between $1,000 to $10,000. You can apply online or by phone.

Costs: The APRs for OnDeck’s term loans range from 27.2% to 99.9% (based on loans originated in the half-year ending March 31, 2024; minimums provided are rates that at least 5% of customers received). These rates include an origination fee of between 2.5% to 4% of the total loan amount. The fee drops to between 1.25% to 3% for your second loan and 0% to 3% for all loans thereafter.

There are no prepayment penalties, and OnDeck offers prepayment options that include potential interest rate reductions. Payments are deducted automatically from your business bank account.

OnDeck’s lines of credit have APRs from 35.9% to 84.9% (based on loans originated in the half-year ending March 31, 2024; minimums provided are rates that at least 5% of customers received). You repay each individual draw on the credit line weekly.

Best uses: OnDeck’s term loans generally are best suited for business owners who need a significant amount of money to buy equipment, open a new location, hire employees or make a large inventory purchase. Its working capital lines of credit are a good option for businesses that to pay for everyday expenses or handle unexpected costs.