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 P2P business loan | $500,000 | 24 months | 15.22% | 6 months to 5 years | with Fundera by NerdWallet |
peer to peer business loan: More details
iBusiness Funding: Best for P2P business loan
iBusiness Funding (formerly Funding Circle) business loans are backed by professional investors. That makes these loans tougher to qualify for than other P2P options, but they come with larger loan amounts — up to $500,000 — at low APRs compared to other online lenders.
iBusiness Funding - Online term loan
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Pros
- Cash can be available within two business days.
- Competitive rates among online lenders.
- Terms up to five years.
- iBusiness Funding also offers SBA loans up to $5 million.
Cons
- Charges an origination fee.
- Must be in business for a minimum of 24 months.
- Minimum credit score is higher than some other lenders.
Pros
- Cash can be available within two business days.
- Competitive rates among online lenders.
- Terms up to five years.
- iBusiness Funding also offers SBA loans up to $5 million.
Cons
- Charges an origination fee.
- Must be in business for a minimum of 24 months.
- Minimum credit score is higher than some other lenders.
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Best peer-to-peer business loan options
iBusiness Funding: Best for established businesses
Kiva: Best for micro-businesses
Honeycomb Credit: Best for businesses with established customer bases
Prosper: Best for new businesses
What is a peer-to-peer business loan?
P2P business loan pros and cons
Pros:
- Less stringent qualifications than banks. If you have fair credit or less than two years in business, you may have an easier time qualifying for a P2P loan than a bank loan — particularly from a lender like Kiva or Honeycomb Credit, which operate more like crowdfunding platforms.
- On crowdfunding platforms, lenders are invested in your success. In order for the people who support your business to recoup their investments — perhaps of their own money — your business needs to last. That may be enough to spur your funders to talk about your company locally or on social media to help grow your customer base.
Cons:
- Higher APRs than banks. If you have good credit and a history of consistent revenue to qualify for a P2P business loan from an institutional investor or crowdfunding platform, you may be able to find a more affordable business loan at a bank or credit union.
- Potentially small loan amounts. While iBusiness Funding offers six-figure loans, it may be more difficult for small businesses to qualify for large loans from other P2P lenders. Honeycomb Credit ultimately determines borrowers’ loan terms, Prosper’s maximum loan amount is $50,000 and Kiva’s is just $15,000.
Alternatives to P2P business loans
- If you need fast funding:
can usually be funded in a matter of days, and some of them require nearlyOnline business loans . They tend to charge higher APRs than P2P business loans, but you may be able to qualify for financing even if you have bad or fair credit.no documentation to apply - If you’re a very small business:
, which are often issued byMicroloans can help borrowers who need $50,000 or less.community development financial institutions (CDFIs) - If you don’t qualify for traditional financing:
can help you raise money from investors and supporters. There are several different kinds of crowdfunding, so you’ll have to choose between giving investors equity in your company or offering a different unique perk.Crowdfunding is another alternative type of lending that relies on the value of unpaid customer invoices rather than things like business financials or personal credit.Invoice financing - If you’re looking for the least expensive option: Another way to avoid taking on debt is by finding
. Many local governments and corporations offer grants, even forsmall-business grants . Though they can be difficult to find and usually don’t give large amounts, avoiding the cost of interest can be worth it in the long run.startups
How Fundera by NerdWallet works
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.
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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.