Retail Business Loans: Best Options and How to Get One
Retail business loans are available from banks, SBA lenders and online lenders.
| Lender | NerdWallet rating | Best For | Max loan amount | Min. time in business | Min. interest rate | Term length | Learn more |
|---|---|---|---|---|---|---|---|
 with Fundera by NerdWallet | Read expert review | Best for Working capital needs | $100,000 | 12 months | 40% | 12 to 24 months | with Fundera by NerdWallet |
 with Fundera by NerdWallet | Read expert review | Best for Startups | $250,000 | 3 months | 36% | 3 to 6 months | with Fundera by NerdWallet |
 with Fundera by NerdWallet | Read expert review | Best for Low interest rates | Undisclosed | 24 months | Undisclosed | 12 months to 5 years | with Fundera by NerdWallet |
 with Fundera by NerdWallet | Read expert review | Best for Bad credit | $1,500,000 | 6 months | Undisclosed | 4 to 18 months | with Fundera by NerdWallet |
 with Fundera by NerdWallet | Read expert review | Best for Equipment financing | $150,000 | 6 months | Undisclosed | 24 months to 5 years | with Fundera by NerdWallet |
 with Fundera by NerdWallet | Read expert review | Best for Large loan amounts | $5,000,000 | 24 months | 10.25% | Up to 25 years | with Fundera by NerdWallet |
 | Read expert review | Best for PayPal users | $300,000 | Undisclosed | Undisclosed | Undisclosed |
best retail business loans: More details
OnDeck: Best for Working capital needs
OnDeck’s line of credit can provide working capital up to $100,000. This credit line can help you buy additional inventory during your busy season or cover overhead costs during a seasonal slow.
May fund quickly
OnDeck - Line of credit
with Fundera by NerdWallet
Max loan amount
$100,000
Min. credit score
625
Term length
12 to 24 months
Pros
- Fast access to working capital.
- Accepts borrowers with a minimum credit score of 625.
- Streamlined application process with minimal documentation required.
- Can be used to build business credit.
Cons
- Not available in North Dakota.
- May require frequent weekly payments.
- Interest rates can be high compared with traditional lenders.
Pros
- Fast access to working capital.
- Accepts borrowers with a minimum credit score of 625.
- Streamlined application process with minimal documentation required.
- Can be used to build business credit.
Cons
- Not available in North Dakota.
- May require frequent weekly payments.
- Interest rates can be high compared with traditional lenders.
with Fundera by NerdWallet
Fundbox: Best for Startups
Fundbox offers flexible funding for retail stores that have been in operation for at least six months.
May fund quickly
Fundbox - Line of credit
with Fundera by NerdWallet
Max loan amount
$250,000
Min. credit score
600
Term length
3 to 6 months
Pros
- Financing available within two business days after approval.
- Simple application with minimal documentation required.
- Low minimum credit score, time in business and annual revenue requirements.
- No prepayment penalties, account maintenance fees or inactivity fees.
Cons
- Rates are high compared with traditional banks.
- Weekly repayments required over a short term (maximum of 24 weeks).
Pros
- Financing available within two business days after approval.
- Simple application with minimal documentation required.
- Low minimum credit score, time in business and annual revenue requirements.
- No prepayment penalties, account maintenance fees or inactivity fees.
Cons
- Rates are high compared with traditional banks.
- Weekly repayments required over a short term (maximum of 24 weeks).
with Fundera by NerdWallet
Bank of America: Best for Low interest rates
Bank of America’s unsecured term loan offers low interest rates and competitive repayment terms. It can be a good option for established retail businesses that want to upgrade their physical location, purchase new equipment or open a new store.
Bank of America Business Advantage Unsecured Term Loan
with Fundera by NerdWallet
Max loan amount
Undisclosed
Min. credit score
700
Term length
12 months to 5 years
Pros
- Bank loan with competitive interest rates.
- No collateral required.
- Bank of America’s Preferred Rewards program can offer interest rate discounts and other perks.
Cons
- Can be slow to fund.
- Prepayment fees may apply to early repayments.
- Must be an existing Bank of America customer to apply online.
- Charges an origination fee.
Pros
- Bank loan with competitive interest rates.
- No collateral required.
- Bank of America’s Preferred Rewards program can offer interest rate discounts and other perks.
Cons
- Can be slow to fund.
- Prepayment fees may apply to early repayments.
- Must be an existing Bank of America customer to apply online.
- Charges an origination fee.
with Fundera by NerdWallet
Fora Financial: Best for Bad credit
Fora Financial provides funding up to $1.5 million that can be used for purchasing supplies, upgrading technology, investing in marketing or hiring sales associates. You may be able to qualify with a minimum credit score of 570 or higher.
Fora Financial - Online term loan
with Fundera by NerdWallet
Max loan amount
$1,500,000
Min. credit score
570
Term length
4 to 18 months
Pros
- Cash can be available quickly.
- Get a discount for prepaying.
- No collateral required.
- Low minimum credit score requirement.
Cons
- Charges a factor rate that makes it more difficult to compare costs with other lenders.
- Can’t build business credit.
- Longest loan term is 18 months.
- Charges an origination fee.
Pros
- Cash can be available quickly.
- Get a discount for prepaying.
- No collateral required.
- Low minimum credit score requirement.
Cons
- Charges a factor rate that makes it more difficult to compare costs with other lenders.
- Can’t build business credit.
- Longest loan term is 18 months.
- Charges an origination fee.
with Fundera by NerdWallet
National Funding: Best for Equipment financing
If you need to purchase equipment for your retail business, National Funding issues equipment loans up to $150,000.
National Funding - Equipment financing
with Fundera by NerdWallet
Max loan amount
$150,000
Min. credit score
600
Term length
24 months to 5 years
Pros
- Funding in as little as 24 hours.
- Prepayment discounts available.
- Offers loans to startups and borrowers with bad credit.
- No collateral or down payment required.
Cons
- Charges a factor rate that makes it more difficult to compare costs with other lenders.
- Requires higher annual revenue than other online lenders.
- Misleading website marketing: National Funding offers only short-term loans and equipment financing/leasing.
- Charges an origination fee.
Pros
- Funding in as little as 24 hours.
- Prepayment discounts available.
- Offers loans to startups and borrowers with bad credit.
- No collateral or down payment required.
Cons
- Charges a factor rate that makes it more difficult to compare costs with other lenders.
- Requires higher annual revenue than other online lenders.
- Misleading website marketing: National Funding offers only short-term loans and equipment financing/leasing.
- Charges an origination fee.
with Fundera by NerdWallet
U.S. Small Business Administration: Best for Large loan amounts
SBA 7(a) loans can provide up to $5 million in funding. So far in fiscal year 2024, 11.3% of all 7(a) loans have been issued to businesses in the retail industry.
Low interest rate
SBA 7(a) loan
with Fundera by NerdWallet
Max loan amount
$5,000,000
Min. credit score
650
Term length
Up to 25 years
Pros
- Large borrowing maximums.
- Interest rates are capped.
- Long repayment terms available.
Cons
- Collateral is typically required.
- Longer processing times than online lenders.
Pros
- Large borrowing maximums.
- Interest rates are capped.
- Long repayment terms available.
Cons
- Collateral is typically required.
- Longer processing times than online lenders.
with Fundera by NerdWallet
PayPal: Best for PayPal users
If your retail business uses PayPal to process sales, you may be able to get a PayPal Working Capital loan. This funding is repaid as a percentage of your PayPal sales, with a minimum repayment every 90 days.
PayPal Working Capital Loan
Max loan amount
$300,000
Min. credit score
300
Term length
Undisclosed
Pros
- No credit check required.
- Low minimum revenue requirements based on PayPal sales.
- Funding available within minutes after approval.
Cons
- Automatic daily repayments deducted as a percentage of your PayPal sales.
- Minimum payment of 5% or 10% of your total loan amount every 90 days.
- Fixed fee structure can make it difficult to compare costs to other loans.
Pros
- No credit check required.
- Low minimum revenue requirements based on PayPal sales.
- Funding available within minutes after approval.
Cons
- Automatic daily repayments deducted as a percentage of your PayPal sales.
- Minimum payment of 5% or 10% of your total loan amount every 90 days.
- Fixed fee structure can make it difficult to compare costs to other loans.
What is a retail business loan?
A retail business loan is a type of financing that’s used to manage or grow your retail business. These loans can be used to:
- Purchase inventory or equipment.
- Make payroll.
- Hire new employees.
- Pay for utilities and other day-to-day expenses.
- Launch marketing or advertising campaigns.
- Upgrade your technology.
- Expand your online presence.
- Improve or expand your physical location.
Types of retail business loans
Many different types of business loans
Business term loans
With a business term loan
If you have a larger project, you might prefer a long-term business loan Short-term business loans
Business lines of credit
Business lines of credit are more flexible than term loans. A business line of credit
As a result, business lines of credit are good for managing cash flow needs and covering everyday expenses. They can also serve as an emergency fund.
🤓
If you need to buy inventory for your retail business, you might consider Nerdy Tip
SBA loans
The most popular SBA loan, the 7(a) loan, can be used for a variety of purposes — making it a good option for the wide-ranging needs of retail businesses. SBA 7(a) loans
Equipment financing
Equipment financing is used specifically for buying new or used equipment for your business. These loans typically function like term loans — in which you borrow funds and repay them over time, with interest.
Because the equipment you purchase serves as collateral on the loan, however, equipment financing
Merchant cash advances
A merchant cash advance MCA company
MCAs are usually fast to fund and easy to qualify for — and can be well suited for retail businesses that have substantial debit and credit card sales. Keep in mind, however, that MCAs are often expensive, with APRs reaching triple digits, so you’ll likely want to consider other options before turning to an MCA.
Where to get retail business loans
Retail business loans are available from both traditional and online lenders.
Banks and credit unions
Banks and credit unions
Some banks and credit unions are also SBA lenders
Online lenders
Online or private business loans
Online lenders also offer streamlined applications with minimal documentation. Some lenders can provide funding in just 24 hours. As a result of this speed and flexibility, however, online lenders often charge higher interest rates.
How to get a retail business loan
To get a retail business loan, you can follow these steps:
1. Evaluate your financing needs
Think about how much business capital working capital line of credit
In any case, you should also make sure that you can afford to take on any potential debt. A business loan calculator
2. Review your qualifications
Most lenders will use a standard set of criteria — personal credit score, annual revenue, time in business — to underwrite your loan application. It can be helpful to know where you stand on these metrics before submitting your application.
Keep in mind that lenders may also consider factors like your cash flow, available collateral
3. Compare lenders
You’ll want to research several different small-business lenders
- Loan types.
- Maximum loan amounts.
- Repayment terms and schedule.
- Interest rates and fees..
- Funding speed.
- Application process.
- Lender reputation.
It can also be useful to read online reviews to get a better sense of what it’s like to work with a particular lender.
4. Gather your documentation and apply
Although the business loan application
- Basic information about you and your business.
- Personal and business bank statements.
- Personal and business tax returns.
- Business financial statements.
- A description of your collateral.
- Existing debt obligations, if applicable.
If you’ve applied with an online lender, you may be able to receive approval and funding by the next business day. Banks and SBA lenders, on the other hand, may take up to several weeks.
Ready to get funding for your retail business?
- If you think you can qualify for a bank loan: Explore the
best banks for small-business loans - If you need fast access to funds or can’t qualify for traditional options: Compare the best
online business loans - If you don’t want to take on debt: Consider alternatives like
small-business grants crowdfunding
Last updated on August 20, 2024
How Fundera by NerdWallet works
Getting a business loan can be challenging, and several factors —
cost, speed, repayment schedule — can play a role in deciding which
product is right for you. Let us help you through the process.
Get started
Fill out one simple application
Answer a 3-minute questionnaire about your business to get personalized lending options. It’s free and won’t impact your credit score.
See your business loan options
Compare interest rates and repayment terms to choose the best product for your needs.
Get your loan
If the lender approves you, you’ll sign closing documents in order to receive funds. Some lenders can approve and fund loans within one business day.
Methodology
NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer small-business friendly features, including:
- Transparency of rates and terms.
- Flexible payment options.
- Fast funding times.
- Accessible customer service.
- Reporting of payments to business credit bureaus.
- Responsible lending practices.
We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodology for small-business loans editorial guidelines
