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Best Inventory Financing Loans for Businesses in 2020

Jackie ZimmermannJanuary 6, 2020

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Inventory financing can help your small business purchase products to meet customer demand. Compare inventory lines of credit and term loans.

Inventory financing refers to a line of credit or term loan that a small-business owner uses to purchase products to sell. It can help keep your shelves stocked during a busy season, or allow you to buy products in bulk at a discount.

Lines of credit offer more flexibility than term loans and work best for financing ongoing inventory purchases. You get a set amount of money you can tap into as needed, and you pay back only what you’ve borrowed.

Term loans may have higher borrowing amounts and longer repayment periods, making them a better choice for financing large, one-time inventory purchases.

We’ve rounded up the best inventory loans based on financing type. Always compare small-business loans to find the one that best fits your needs.

Easily get real, personalized small business loan rates to compare — not just ranges or estimates.

It’s free and won’t affect your credit.

Get Started

on Fundera's website

Our picks for

Inventory lines of credit

Kabbage - Line of credit

Kabbage - Line of credit

Est. APR

24.00 - 99.00%

Min. Credit Score

560

Pros

  • Financing up to $250,000 available within a few days.
  • Accepts low credit scores.

Cons

  • Rates are high compared to other online lenders.
  • Must have online checking or PayPal account to verify cash flow.
  • Fixed-fee structure means early repayment does not save interest.

Qualifications

  • Minimum credit score: 560.
  • Minimum time in business: 1 year.
  • Minimum annual revenue: $50,000.
Read full review
Kabbage provides fast loans for business owners with bad personal credit, but rates can be high.
Fundbox - Line of credit

Fundbox - Line of credit

Est. APR

10.10 - 79.80%

Min. Credit Score

550

Pros

  • Cash can be available by the next day.
  • Low minimum credit score requirement.

Cons

  • Rates are high compared to traditional banks.

Qualifications

  • Minimum credit score: 550.
  • Minimum time in business: 3 months.
  • Minimum annual revenue: $50,000.
Read full review
Fundbox offers a business line of credit to fill a cash-flow gap, and qualifying is easier than with other lenders.
BlueVine - Line of credit

BlueVine - Line of credit

Est. APR

15.00 - 78.00%

Min. Credit Score

650

Pros

  • Cash can be available within 12 to 24 hours.
  • Multiple products for different financing needs

Cons

  • Short repayment term results in higher payment amounts.
  • Requires personal guarantee.
  • Not available in North Dakota, South Dakota or Vermont.

Qualifications

  • 6-month line of credit
  • Minimum credit score: 650.
  • Minimum time in business: 36 months.
  • Minimum annual revenue: $100,000.
  • 12-month line of credit
  • Minimum credit score: 650.
  • Minimum time in business: 3 years.
  • Minimum annual revenue: $480,000.
Read full review
BlueVine's line of credit provides fast working capital for short-term borrowing needs.

Our picks for

Inventory loans

Credibility Capital - Online term loan

Credibility Capital - Online term loan

Est. APR

19.99 - 24.99%

Min. Credit Score

680

Pros

  • Competitive rates among online lenders.
  • No prepayment penalty.
  • Extra monthly payments can save interest cost.

Cons

  • Short repayment term results in higher payment amounts.
  • Requires high minimum credit score and revenue.
  • Requires business lien and may require personal guarantee.
  • Not available in Nevada, North Dakota, South Dakota, or Vermont.

Qualifications

  • Minimum credit score: 680.
  • Minimum time in business: 2 years.
  • Minimum annual revenue: $250,000.
  • No bankruptcies in the past 5 years.
Read full review
Credibility Capital offers low-cost business loans that work best for small-business owners with strong credit.
OnDeck - Online term loan

OnDeck - Online term loan

Est. APR

9.00 - 99.00%

Min. Credit Score

600

Pros

  • Cash can be available within the same business day.
  • Requires low minimum credit score.
  • Less paperwork than most lenders.

Cons

  • Fixed-fee structure means early repayment will not save interest.
  • Requires frequent (daily or weekly) repayments.
  • Requires business lien and personal guarantee.

Qualifications

  • Minimum credit score: 600.
  • Minimum time in business: 3 years.
  • Minimum annual revenue: $250,000.
  • No bankruptcies in the past 2 years.
Read full review
OnDeck offers a fast term loan for small-business owners with less-than-stellar credit who want to expand.

Easily get real, personalized small business loan rates to compare — not just ranges or estimates.

It’s free and won’t affect your credit.

Get Started

on Fundera's website

Summary of Best Inventory Financing Loans for Businesses in 2020

Inventory lines of credit

If you want fast cashKabbage offers a working-capital line of credit of up to $250,000. The company requires a minimum credit score of 560 to qualify. Borrowing costs, though, may be higher than other options.

Fundbox provides a short-term line of credit of up to $100,000, with weekly repayments up to 12 weeks. Funding is as fast as the next business day.

If you have less than a year in business: BlueVine offers a six-month line of credit of up to $250,000. It requires just six months in business to qualify.

Unlike Kabbage and Fundbox, BlueVine requires a personal credit score starting at 600. For more-established businesses, BlueVine also offers a 12-month option, which requires a credit score starting at 620 and at least two years in business.

If you want the lowest rates: StreetShares offers a line of credit with the lowest starting rates among these options. Financing maxes out at 20% of your revenue for companies that are making at least $75,000 in annual revenue.

If you have small recurring purchases: You may want to consider a business credit card. Your credit limit may be smaller than a line of credit, but advantages include rewards, cash back and an introductory 0% APR period. You can qualify based on your personal credit score even if you don’t have an established business.

Inventory loans

If you have strong credit and want competitive rates: Online lender Credibility Capital requires a personal credit score starting at 680 to qualify, and you’ll need at least two years in business and a minimum of $250,000 in annual revenue.

If you want quick approval and ease of applicationOnDeck’s term loan application takes less than 10 minutes, and loans can be transferred to a business bank account as fast as 24 hours. Its minimum personal credit score requirement of 600 is lower than the one at Credibility Capital, but typical OnDeck borrowers have scores of 680 to 720.

Compare small-business loans

For a look beyond inventory loans, check out NerdWallet’s small-business loans tool. We gauged lender trustworthiness, market scope and user experience, among other factors, and arranged the lenders by categories that include your revenue and how long you’ve been in business.

Last updated on January 6, 2020

To recap our selections...

NerdWallet's Best Inventory Financing Loans for Businesses in 2020