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.
Here are 5 cash flow loans
| Lender | NerdWallet Rating▼ | Max loan amount▼ | Min. credit score▼ | Next steps |
|---|---|---|---|---|
American Express® Business Line of Credit | 4.5/5 Best for Cash flow lines of credit | $250,000 | 660 | Read Review |
OnDeck - Online term loan with Fundera by NerdWallet | 5.0/5 Best for Short-term cash flow loans | $250,000 | 625 | with Fundera by NerdWallet |
Fundbox - Line of credit | 5.0/5 Best for Cash flow loans for startups | $150,000 | 600 | Read Review |
Fora Financial - Online term loan with Fundera by NerdWallet | 4.5/5 Best for Cash flow loans for bad credit | $1,500,000 | 500 | with Fundera by NerdWallet |
Bluevine - Line of credit with Fundera by NerdWallet | 5.0/5 Best for Fast cash flow loans | $250,000 | 625 | with Fundera by NerdWallet |
Here are 5 cash flow loans
Best for Cash flow lines of credit
Best for Short-term cash flow loans
Best for Cash flow loans for startups
Best for Cash flow loans for bad credit
Best for Fast cash flow loans
Our pick for
Cash flow lines of credit
American Express offers business lines of credit from $2,000 to $250,000 that can be used for working capital needs.
American Express® Business Line of Credit
Max Loan Amount
$250,000
Min. credit score
660
The American Express® Business Line of Credit is a good option for business owners with fair credit who want access to working capital.
Max loan
$250,000
Min. Credit score
660
Our pick for
Short-term cash flow loans
OnDeck’s term loan is available in amounts up to $250,000 with repayment terms up to 24 months. It can be a good option for specific investments in your business.
OnDeck - Online term loan
Max Loan Amount
$250,000
Min. credit score
625
Est. APR
35.40-99.90%
OnDeck offers a fast term loan for small-business owners with less-than-stellar credit who want to expand.
May fund quickly
Max loan
$250,000
Min. Credit score
625
Apr range
35.40-99.90%
Our pick for
Cash flow loans for startups
Fundbox offers lines of credit up to $150,000. You may be able to qualify with just six months in business.
Fundbox - Line of credit
Max Loan Amount
$150,000
Min. credit score
600
Est. APR
10.10-79.80%
Fundbox offers a business line of credit to fill a cash flow gap, and qualifying is easier than with other lenders.
May fund quickly
Max loan
$150,000
Min. Credit score
600
Apr range
10.10-79.80%
Our pick for
Cash flow loans for bad credit
Fora Financial’s term loan can be used for a wide variety of purposes. You may be able to qualify with a minimum personal credit score of 500.
Fora Financial - Online term loan
Max Loan Amount
$1,500,000
Min. credit score
500
Fora Financial can be a good fit for borrowers who may fall short of qualifying for traditional bank financing or young but established small businesses looking for speedy financing.
Max loan
$1,500,000
Min. Credit score
500
Our pick for
Fast cash flow loans
Bluevine’s revolving line of credit is available up to $250,000 with repayment terms of six or 12 months. You can receive approval and get funding in as fast as 24 hours.
Bluevine - Line of credit
Max Loan Amount
$250,000
Min. credit score
625
Est. APR
20.00-50.00%
Bluevine's line of credit provides fast working capital for short-term borrowing needs.
May fund quickly
Max loan
$250,000
Min. Credit score
625
Apr range
20.00-50.00%
What is a cash flow loan?
Any type of small-business loan that is used to meet cash flow needs could be considered a “cash flow loan.” Typically, however, the term cash flow loan refers to unsecured loans that are issued based on the projected revenue of your business.
Cash flow loans can finance a variety of purposes, such as:
- Purchasing inventory.
- Hiring staff.
- Making payroll.
- Covering day-to-day expenses (e.g., rent, insurance).
- Managing a seasonal slowdown or cash flow gap.
How do cash flow loans work?
Cash flow loans are usually available from online or other alternative lenders. Instead of relying on your credit score or available collateral, these lenders prioritize your business revenue when underwriting your loan application.
Cash flow lenders may ask to see your bank statements, financial statements and merchant accounts, among other documentation to evaluate your business’s historical and projected performance. Although the lender may check your credit history and ask how long you’ve been in business, these factors tend to weigh less heavily on the decision-making process.
If you’re approved, the lender will also use its evaluation of your finances to set your interest rate and repayment terms.
Some cash flow loans will be structured like a standard term loan or line of credit, while others will work like a merchant cash advance. In this case, you receive an upfront sum of capital and repay it using a percentage of your debit and credit card sales, plus a fee.
In general, cash flow loans have shorter terms and higher interest rates than more conventional small-business loans, like bank or SBA loans.
Cash flow loan example
Let’s say your business needs to purchase $25,000 in inventory in order to accommodate sales during the holiday season. You’ve been operational for about one year and have fair credit, but you need capital quickly and don’t have much collateral to put up to secure a loan.
You look to an online lender who evaluates your loan application based on your business’s revenue and projected sales for the upcoming holiday rush. The lender offers you a cash flow loan to purchase the inventory you need.
With the funds from the loan, you get your inventory and are able to accommodate your customers’ needs for the holiday season. As you bring in money from the sales, you repay your $25,000 loan with interest.
Pros and cons of cash flow loans
Pros
- Quick to fund. If you need a fast business loan, some cash flow lenders can approve and fund applications in just 24 hours. And while bank and SBA lenders may take weeks or even months to issue financing, most cash flow loans are available within a few business days.
- Streamlined applications. Cash flow loans are usually issued by online lenders, who typically offer a streamlined application process. You can often complete and submit a simple application with minimal documentation required. Plus, cash flow lenders may leverage technology to underwrite your application — asking you to connect your financial accounts to their online platform — instead of having you submit documents for them to review manually.
- Flexible requirements. Cash flow lenders prioritize your historical and projected revenue when evaluating your application — meaning they’re generally more flexible when it comes to traditional eligibility requirements. Although requirements vary by lender, startups and/or businesses with bad credit may be able to qualify.
- No physical collateral required. You don’t need to put up physical collateral, like equipment or real estate, to secure a cash flow loan. Asset-based lenders, on the other hand, will require collateral to back your financing.
Cons
- Can be expensive. Because of their unique underwriting process and lack of collateral, cash flow loans are considered riskier than traditional business loans. To offset this risk, lenders typically charge higher interest rates and fees — ranging anywhere from 10% to 99% APR. Interest rates can even reach triple digits with products like merchant cash advances.
- Frequent repayments. Cash flow loans tend to have short terms and frequent repayments, daily or weekly, instead of monthly. This payment schedule can impact your cash flow and be difficult to manage, particularly if you’re a seasonal business or took out the loan to fill a cash flow gap. The frequent payments combined with high interest rates can trap you into a cycle of debt that’s hard to break out of, especially if you need to take another loan or refinance an existing one to repay.
- Personal guarantee/business lien required. Although you won’t need to secure your cash flow loan with physical collateral, most lenders will require you to sign a personal guarantee. This agreement states that you’ll pay back your loan with your personal assets if your business defaults. Some lenders may also take out a Uniform Commercial Code lien on your business assets. This document allows a lender to use your business assets to recoup its losses in the case of default.
How to get a cash flow loan
To get a cash flow loan, you can follow these basic steps.
Understand your financing needs
Determine what you’re going to use your loan for, how much capital you need and how quickly you need it. Also, think about which type of cash flow loan is the best fit for your needs. For example, if you think a revolving source of funding would be beneficial, maybe a business line of credit is the best option.
Evaluate your business credentials
You’ll want to look closely at your historical revenue, projected revenue, cash flow and other financial data. Although your credit score may not be a top priority for cash flow lenders, you should also check your credit history to help you get a sense of what type of loans you can qualify for, and what loan amount and rate you might expect.
Research and compare lenders
Explore several online lenders to find the right option for your business. When comparing different options, consider factors such as interest rates, repayment terms, funding speed, application process, customer service and lender reputation.
Submit your application
Cash flow lenders typically offer simple, online applications that can be completed in a matter of minutes. You shouldn’t need extensive documentation, but you may be asked to provide
- Personal and business tax returns.
- Personal and business bank statements.
- Business financial statements (e.g., profit and loss statement or a balance sheet).
You’ll also likely be required to sign a personal guarantee.
Review your loan agreement
Thoroughly review your loan agreement before signing and make sure the interest rates and repayment terms are laid out clearly. Instead of using an annual percentage rate, some cash flow lenders may give simple interest rates or factor rates, so you’ll want to try and calculate these rates into an APR to get a better understanding of how much your loan costs.
If you have any questions or concerns about your business loan agreement, reach out to your lender for clarification. If a lender won’t provide rates and terms upfront or seems hesitant to provide straightforward answers to your questions, these could be red flags of a predatory company. In this case, you might consider looking for a loan elsewhere.
» Estimate rates and payments with our business loan calculator
Find the right business loan
The best business loan is generally the one with the lowest rates and most ideal terms. But other factors — like time to fund and your business’s qualifications — can help determine which option you should choose. NerdWallet recommends comparing small-business loans to find the right fit for your business.
Former NerdWallet writer Jackie Zimmermann contributed to this article.
Last updated on September 25, 2023
Methodology
NerdWallet reviewed both traditional and online lenders in order to create our list of the best cash flow loans.
Our list includes a variety of loan options to meet the diverse funding needs of small-business owners, with an emphasis on lenders that offer a streamlined underwriting and approval process.
Each cash flow loan option on our list meets the following criteria:
- Maximum loan amount of at least $150,000.
- Transparent rates and repayment terms.
- Funding available within two weeks of applying.
- Personal credit score requirements of 660 or below.
- No more than two years in business required.
Wondering if you qualify?
It’s possible to get a business loan even if you have bad credit. Bad-credit business loans are available from alternative sources, like online or nonprofit lenders.
Learn more
Frequently Asked Questions
Interest rates on cash flow loans range anywhere from 10% to 99%. APRs on merchant cash advances can even reach triple digits. The interest rate you receive, however, will vary based on your lender and business’s qualifications.
Some of the most common types of cash flow loans include business lines of credit, short-term loans, invoice financing and merchant cash advances.
Cash flow loans are typically considered unsecured because you don’t need to provide physical collateral, like equipment or real estate, to get approved. Most cash flow lenders, however, will require you to sign a personal guarantee and/or take out a lien on your business assets.