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If you have a thin or rocky credit history, you may be able to get a business loan with no credit check. Although most lenders will check your credit as part of the application process, some may waive this requirement, and others will perform only a soft inquiry, which doesn’t affect your credit score.
These no credit check business loans, however, are typically expensive — with high interest rates and fees and short terms. You should also be careful because some predatory lenders promise “no credit check” or “guaranteed approval” to try to take advantage of borrowers who are having trouble qualifying for a small-business loan.
How much do you need?
We’ll start with a brief questionnaire to better understand the unique needs of your business.
Once we uncover your personalized matches, our team will consult you on the process moving forward.
Best business loans with no credit check
Although no credit check business loans are few and far between, alternative online lenders can be more flexible with their credit requirements and offer quick access to capital. These loans can help you build business credit; however, they are often structured as merchant cash advances and carry high interest rates, so be sure you understand the true cost of borrowing before signing an agreement. Our business loan calculator can help.
Here are a few loan options to consider:
PayPal Working Capital
Best for PayPal users
- Must be a PayPal Premier or Business account holder for at least 90 days.
- Amounts between $1,000 and $250,000 depending on borrowing history and account type.
- Fixed fee.
The PayPal Working Capital loan doesn’t require a credit check; instead, it considers your PayPal account history. You must process at least $20,000 in annual PayPal sales if you have a Premier account and at least $15,000 if you have a PayPal Business account.
This no credit check business loan offers flexible payments, and funding can arrive in minutes. Rather than a more traditional annual percentage rate (APR), you’ll pay a fixed fee based on your loan amount, selected repayment percentage and your business's PayPal account history. Like a typical merchant cash advance, you dedicate a portion of your sales to automatically repay the loan and fee.
Square loans
Best for Square sellers
- Loan amounts between $300 and $250,000.
- No personal guarantees and applying doesn’t impact personal credit.
- Fixed fee.
Similar to PayPal, Square offers loans to business owners who sell on its platform. To qualify for a Square loan, you’ll ideally process $10,000 or more per year through the platform.
Square also evaluates applications based on payment frequency, customer mix and payment disputes, among other factors. You repay the loan automatically with a percentage of your daily credit card sales through Square. The fixed fee you pay varies based on your loan size and processing volume.
Once you’re approved, you can receive funds in one to three business days or instantly if you have a Square checking account.
FundThrough
Best for invoice factoring
- Fees between 2.75% and 8.25% depending on net terms.
- Must have an outstanding invoice of at least $100,000 in accounts receivable or invoices to one customer.
- Funding available as quickly as the next day.
If you have a shaky credit history and capital tied up in unpaid invoices, FundThrough may be able to provide the financing you need. FundThrough offers invoice factoring for business-to-business companies that have outstanding invoices that are less than 90 days old.
FundThrough advances your business capital and collects payment from your customer — in exchange for a fee that varies based on the net terms of your invoice. FundThrough does not require a credit check; instead, it evaluates your application based on the value of your invoices as well as your banking history and tax history.
AltLINE
Best for startups
Best for startups.
- Advance up to 90% of your unpaid invoices up to $10 million.
- Factor rates starting at 0.5%.
- Personal guarantees required for owners of 10% or more of the business.
AltLINE is an invoice factoring company operating as a division of The Southern Bank. They have no credit score minimum, no minimum revenue requirement and no time in business requirement, making them a great option for startups with less-than-stellar credit.
Unlike most factoring companies, AltLINE is its own bank, which means they can lend directly to your business instead of acting as a middleman. This can also allow them to offer lower prices and faster funding.
Pros and cons of business loans with no credit check
Pros
Making payments on time may build your business and/or personal credit profile.
Potential access to funding even with bad credit.
May be easier to borrow in the future if you pay back the loan on time.
Cons
May pay additional fees.
No credit check business loans often come with high interest rates, which may outweigh the benefits of the loan.
Not all lenders report on-time payments to credit bureaus — meaning getting a loan won’t necessarily help you build credit.
Types of no credit check business loans
Generally, there are a few types of business loans that don’t require credit checks:
- Invoice factoring is a method of small-business financing that involves selling unpaid customer invoices to a factoring company, which then takes over collecting payment from your clients. Invoice factoring is not technically a loan, and approval is typically based on the creditworthiness of your customers.
- Payment processor loans are a type of merchant financing that’s offered by payment processor companies, usually exclusively to its customers. Repayment is collected automatically from those seller accounts and approvals are typically based on sales numbers.
- Merchant cash advances (MCAs) are cash advances that are repaid through a percentage of daily sales, usually deducted automatically. They don’t typically require personal credit checks; however, MCAs are one of the most expensive forms of small-business financing, often carrying triple-digit APRs.
Can you get guaranteed startup business loans with no credit check?
Getting a startup business loan can be difficult — but even more so if your credit is bad, which by industry standards typically means a score between 300 and 629 (on a scale of 300 to 850). Many things can affect your credit score, including length of credit history, your mix of credit account types and delinquencies or bankruptcies.
Some lenders offer startup business loans for borrowers with bad credit, but they’ll likely check your credit history in some way, such as performing a soft pull. Like other bad credit loans, these options typically come with high interest rates and short terms.
Certain lenders may promise “guaranteed” startup business loans, but you should tread lightly around these offers. Credible business lenders are unlikely to promise guaranteed approval and instead will evaluate your loan application (including your credit score) before making a decision.
🤓 Nerdy Tip
If you’re concerned about how a hard credit inquiry may affect your credit score, know that inquiries only stay on your credit report for two years at most, and don’t have a significant impact on your score after a few months. Learn more about hard credit inquiries.Alternatives to no credit check business loans
If you can wait to get business financing until your credit score has grown, you’ll likely be able to receive more competitive interest rates and repayment terms. However, there are options you can consider that don’t necessarily require a good credit score, such as:
Small-business grants
Business grants are available from federal and state agencies as well as private companies. You don’t typically need good credit to qualify for a business grant, and certain grants are available specifically for startups.
Depending on the company offering the funding, you may have to meet other criteria. Small Business Innovation Research grants from the federal government, for example, are available only to companies that perform research and development for technology innovation and scientific research.
It can take time and effort to find and apply for a small-business grant, but if you can secure one, you’ll have access to free financing.
Nontraditional lenders
An alternative, or nontraditional lender, is technically any lender that’s not a bank or credit union. Many nontraditional lenders, such as nonprofit lenders, online lenders or community development financial institutions (CDFIs), offer safe and fair options that don’t require stellar credit. For example, Accion Opportunity Fund is a nonprofit small-business lender with a minimum credit score requirement of
570
, but may work with lower scores on a case-by-case basis. Similarly, OnDeck is an online lender that offers term loans and lines of credit and requires a minimum credit score of 625
.Crowdfunding
Crowdfunding can be a good option for startups and other businesses to raise money through the power of the internet and social media. You set up a campaign using a crowdfunding platform and provide information about your business and funding goals.
Once your campaign is published, you market your business to friends, family and anyone else that you think might donate to help your company. In exchange for donations, you might offer a perk, such as exclusive access to products or discounts on purchases.
On the other hand, you can offer equity crowdfunding, in which you sell partial ownership in your company in exchange for funds.
Friends and family
If you have individuals in your network who have the means to provide capital, you might reach out to them for your funding needs. Borrowing money from friends or family can be tricky, however, so you’ll want to set up a clear financial agreement upfront.
You’ll need to specify whether the financing is a donation or loan or whether you’re receiving funds in exchange for equity. No matter which option you choose, your agreement should detail any stipulations regarding the money to prevent strain on your relationship with friends or family.
Frequently Asked Questions
Yes, it is possible to get a business loan with a 500 credit score; however, you may have higher rates and fees as a consequence.
If you have no personal credit history, but have built an established and reputable business, you may be able to get a line of credit through an online lender or a traditional lender like a bank, especially if you are able to secure the line of credit with deposits or other collateral.
Merchant cash advances, payment processor loans and invoice factoring loans are examples of loans that do not require credit checks.
