Best Startup Business Loans for Bad Credit of 2025
Startup business loans are available if you have bad credit, but you should shop carefully to keep costs in line.
Online and nonbank lenders may offer business loans for startups with bad credit, but they can be expensive with higher interest rates and fees. You should make sure your new business can handle the potential costs of any debt before taking it on.
To qualify for financing, you may need at least three months in business and a minimum credit score of 500, although requirements vary by lender. Reputable lenders do not offer small-business loans
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Best Startup Business Loans for Bad Credit
| Loan | NerdWallet rating | Best For | Max loan amount | Min. credit score | Next steps |
|---|---|---|---|---|---|
 Expansion Capital Group - Merchant cash advance with Fundera by NerdWallet | Best for easy approval | $300,000 | 500 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 Giggle Finance - Merchant cash advance with Fundera by NerdWallet | Best for small-dollar merchant cash advances | $10,000 | 300 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 Fora Financial - Online term loan with Fundera by NerdWallet | Best for short-term loans | $1,500,000 | 570 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 OnDeck - Online term loan with Fundera by NerdWallet | Best for no collateral requirements | $250,000 | 625 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 Fundbox - Line of credit with Fundera by NerdWallet | Best for quick funding | $250,000 | 600 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 Accion Opportunity Fund Small Business Working Capital Loan with Fundera by NerdWallet | Best for low revenue | $250,000 | 600 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 National Funding - Equipment financing with Fundera by NerdWallet | Best for equipment financing | $150,000 | 600 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 AltLINE - Invoice factoring with Fundera by NerdWallet | Best for invoice factoring | $5,000,000 | 300 | with Fundera by NerdWallet | |
| Pros
Cons
| |||||
 Kiva U.S. - Microloan | Best for zero-interest loans | $15,000 | 300 | ||
| Pros
Cons
| |||||
Best Startup Business Loans for Bad Credit
Max loan amount
$300,000
Min. credit score
500
Min. annual revenue
$100,000
See Your Loan Optionswith Fundera by NerdWallet
Pros
- Simple application with minimal documentation required.
- Low minimum credit score requirement.
- Daily or weekly repayment available.
- Offers prepayment discounts.
Cons
- Business assets required as collateral in some cases.
- Factor rate and fee information not available on website.
- Charges an origination fee and a monthly servicing fee.
Expansion Capital Group - Merchant cash advance
Best for easy approval
Max loan amount
$300,000
Min. credit score
500
Min. annual revenue
$100,000
with Fundera by NerdWallet
Pros
- Simple application with minimal documentation required.
- Low minimum credit score requirement.
- Daily or weekly repayment available.
- Offers prepayment discounts.
Cons
- Business assets required as collateral in some cases.
- Factor rate and fee information not available on website.
- Charges an origination fee and a monthly servicing fee.
Max loan amount
$10,000
Min. credit score
300
Min. annual revenue
$18,000
with Fundera by NerdWallet
Pros
- No minimum credit score requirement.
- Same-day funding available.
- Specifically designed for freelancers and self-employed individuals.
Cons
- Funding maxes out at $10,000 ($20,000 for repeat customers).
- Factor rate and fee information not available on website.
- Charges an origination fee.
Giggle Finance - Merchant cash advance
Best for small-dollar merchant cash advances
Max loan amount
$10,000
Min. credit score
300
Min. annual revenue
$18,000
with Fundera by NerdWallet
Pros
- No minimum credit score requirement.
- Same-day funding available.
- Specifically designed for freelancers and self-employed individuals.
Cons
- Funding maxes out at $10,000 ($20,000 for repeat customers).
- Factor rate and fee information not available on website.
- Charges an origination fee.
Max loan amount
$1,500,000
Min. credit score
570
Min. annual revenue
$240,000
with Fundera by NerdWallet
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.
Fora Financial - Online term loan
Best for short-term loans
Max loan amount
$1,500,000
Min. credit score
570
Min. annual revenue
$240,000
with Fundera by NerdWallet
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.
Max loan amount
$250,000
Min. credit score
625
Min. annual revenue
$100,000
with Fundera by NerdWallet
Pros
- Cash can be available within the same business day (does not apply in California or Vermont).
- Accepts borrowers with a minimum credit score of 625.
- Streamlined application process with minimal documentation required.
- Can be used to build business credit.
Cons
- Cannot fund North Dakota-based businesses.
- Requires frequent (daily or weekly) repayments.
- Interest rates can be high compared with traditional lenders.
- Charges origination fee.
OnDeck - Online term loan
Best for no collateral requirements
Max loan amount
$250,000
Min. credit score
625
Min. annual revenue
$100,000
with Fundera by NerdWallet
Pros
- Cash can be available within the same business day (does not apply in California or Vermont).
- Accepts borrowers with a minimum credit score of 625.
- Streamlined application process with minimal documentation required.
- Can be used to build business credit.
Cons
- Cannot fund North Dakota-based businesses.
- Requires frequent (daily or weekly) repayments.
- Interest rates can be high compared with traditional lenders.
- Charges origination fee.
Max loan amount
$250,000
Min. credit score
600
Min. annual revenue
$30,000
with Fundera by NerdWallet
Pros
- Financing available within one business day 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).
Fundbox - Line of credit
Best for quick funding
Max loan amount
$250,000
Min. credit score
600
Min. annual revenue
$30,000
with Fundera by NerdWallet
Pros
- Financing available within one business day 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).
Max loan amount
$250,000
Min. credit score
600
Min. annual revenue
$50,000
with Fundera by NerdWallet
Pros
- Loan amounts from $5,000 to $250,000.
- Customized loan terms.
- No prepayment penalty.
Cons
- Slower processing speed compared with online lenders.
- Charges an origination fee.
- Not available in all U.S. states.
Accion Opportunity Fund Small Business Working Capital Loan
Best for low revenue
Max loan amount
$250,000
Min. credit score
600
Min. annual revenue
$50,000
with Fundera by NerdWallet
Pros
- Loan amounts from $5,000 to $250,000.
- Customized loan terms.
- No prepayment penalty.
Cons
- Slower processing speed compared with online lenders.
- Charges an origination fee.
- Not available in all U.S. states.
Max loan amount
$150,000
Min. credit score
600
Min. annual revenue
$250,000
with Fundera by NerdWallet
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.
National Funding - Equipment financing
Best for equipment financing
Max loan amount
$150,000
Min. credit score
600
Min. annual revenue
$250,000
with Fundera by NerdWallet
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.
Max loan amount
$5,000,000
Min. credit score
300
Min. annual revenue
Undisclosed
with Fundera by NerdWallet
Pros
- Capital available within 24 to 48 hours.
- No collateral required.
- Manages payment collection from your customers.
- Accepts startups and businesses with bad credit.
Cons
- Fees can become expensive the longer it takes your customers to pay.
- Difficult to compare factoring costs to other types of business loans.
- Charges an origination fee.
AltLINE - Invoice factoring
Best for invoice factoring
Max loan amount
$5,000,000
Min. credit score
300
Min. annual revenue
Undisclosed
with Fundera by NerdWallet
Pros
- Capital available within 24 to 48 hours.
- No collateral required.
- Manages payment collection from your customers.
- Accepts startups and businesses with bad credit.
Cons
- Fees can become expensive the longer it takes your customers to pay.
- Difficult to compare factoring costs to other types of business loans.
- Charges an origination fee.
Max loan amount
$15,000
Min. credit score
300
Min. annual revenue
Undisclosed
Pros
- Reports to credit bureaus, which can help you build business credit.
- Don’t need to meet credit, time in business, or annual revenue requirements to qualify.
Cons
- Funding can take weeks and depends on your fundraising efforts.
Kiva U.S. - Microloan
Best for zero-interest loans
Max loan amount
$15,000
Min. credit score
300
Min. annual revenue
Undisclosed
Pros
- Reports to credit bureaus, which can help you build business credit.
- Don’t need to meet credit, time in business, or annual revenue requirements to qualify.
Cons
- Funding can take weeks and depends on your fundraising efforts.
Concerned about tariffs?
Many small-business owners are under increased economic stress and uncertainty following the latest tariff announcements. NerdWallet is here to help you find answers for whatever you're looking for. Here are some resources to help you get started:
- Need emergency funding? Consider a
business line of credit - Looking for fast access to working capital? Discover the
best working capital loans - Want tips on how to mitigate the impact of tariffs? Read
our guide
A closer look at the best startup business loans for bad credit
Expansion Capital Group
Best for easy approval
Who should consider it : Businesses that want a fast and simple application process.
Editorial take
Giggle Finance
Best for small-dollar merchant cash advances
Who should consider it : Borrowers who only need a small amount of money.
Editorial take
Fora Financial
Best for short-term loans
Who should consider it : Businesses with cash flow gaps.
Editorial take
OnDeck
Best for no collateral requirements
Who should consider it : Businesses that don’t have large assets to pledge.
Editorial take
Fundbox
Best for quick funding
Who should consider it : Borrowers who need access to flexible capital fast.
Editorial take
Accion Opportunity Fund
Best for low revenue
Who should consider it : Early-stage minority- or women-owned companies that have at least $50,000 in annual revenue.
Editorial take
» MORE: Can you get a startup business loan if your company has no revenue
National Funding
Best for equipment financing
Who should consider it : Businesses that need to finance large equipment purchases.
Editorial take
AltLINE
Best for invoice factoring
Who should consider it : B2B businesses that have cash flow tied up in unpaid customer invoices.
Editorial take
Kiva
Best for zero-interest loans
Who should consider it : Businesses that only need a small amount of funding and are willing to manage a crowdfunding campaign.
Editorial take
What is a bad credit score?
According to the most common scoring models, such as FICO and VantageScore, poor or bad credit scores can fall between 300 and 629, while scores between 630 and 689 may be considered fair. Length of credit history, mix of account types (loans, credit cards, etc.), delinquencies or poor payment history are among the factors that can influence your credit score.
Credit score requirements will vary based on your lender and the type of loan you’re looking for, but bad-credit business loans
🤓 Nerdy Tip
Predatory lenders often target borrowers who are having trouble qualifying for financing. Be wary of any lender that guarantees approval, advertises business loans with no credit check
At best, those may be expensive products. At worst, they could signal predatory lenders that will potentially hurt your new company more than help it.
Options for startup business loans with bad credit
Banks and other traditional lenders often won’t lend to startups, especially those with a low credit score or thin credit history, because these businesses don’t have an established financial history to prove they can repay their debts. Online lenders
It is possible to get a startup business loan with bad credit, but options will be limited — and potentially costly. Here are some choices to consider.
Online loans
Online lenders may offer startup business loans
To qualify, your startup will typically need to be generating income already. For example, the Fundbox line of credit requires at least $8,333 in monthly revenue. You don’t usually have to provide collateral for these loans, though lenders may ask for a personal guarantee general lien
Online lenders may offer different types of business loans, such as short-term loans, business lines of credit, equipment financing invoice factoring
Community development financial institution loans
Community development financial institutions, or CDFIs, receive funding to help underserved communities. Startups that lack resources, opportunity or financial access may be able to get a business loan from a CDFI
Because CDFIs are typically banks and credit unions, they may offer competitive rates if you can qualify. However, approvals can take time, so your business will need to be able to wait for funding.
You can find a full list of community development institutions in your state on the CDFI Fund website
Microloans
Similar to CDFIs, microlenders
Some microlenders also issue loans through the SBA microloan program
Merchant cash advances
Merchant cash advance companies are alternative lenders that offer an upfront sum of capital that you repay with a percentage of your debit and credit card sales, otherwise known as a merchant cash advance PayPal Shopify
MCAs are generally easier to qualify for than typical business loans. Many merchant cash advance companies
It’s important to keep in mind, however, that these products can significantly impact your cash flow and have high costs (APRs can reach up to 350%), so you’ll likely want to consider all other options before turning to an MCA.
How to get startup business loans with bad credit
1. Evaluate your business’s credentials
In order to determine what type of business loan you can qualify for, you should check your personal credit score
Although eligibility requirements
- Personal credit score of 500 or higher.
- At least three months in business.
- Consistent revenue.
2. Calculate how much debt you can afford
A lower credit score and shorter time in business can result in higher interest rates — making it difficult to repay a new loan. You’ll want to figure out how much debt you can afford before comparing loan options.
You should break down different possibilities — taking into account how much funding you need, potential interest rates
Before moving forward, you’ll want to make sure that taking on a loan will actually benefit your business at this time.
» Use our business loan calculator
3. Compare lenders
Generally, online lenders will offer the most options for startup business loans for bad credit. You may also find CDFIs or microlenders that are willing to work with your business. You’ll want to make sure that you understand the lender’s product offering and eligibility requirements before applying.
4. Prepare and strengthen your application
Lenders often consider startups and borrowers with bad credit as risky investments. Once you’re ready to start the application process, therefore, you’ll want to strengthen your business profile to help increase your chances of approval. You can:
Build your credit
Offer collateral
Add a cosigner
5. Submit your application
Depending on your lender, you’ll submit your business loan application online, over the phone or in person. Lenders will typically ask you to provide:
- A business plan.
- Business and personal bank statements.
- Business and personal tax returns.
- Business financial statements, such as a profit and loss statement or a balance sheet.
- Cash flow projections.
You may also be required to sign a personal guarantee.
Because a good business plan can help you get funding
6. Review agreement and get funds
Some online lenders can issue financing within 24 hours, whereas other lenders may take longer to approve and fund loans. Before making a decision, you’ll want to compare any and all loan offers to make sure you’re getting the best deal for your business.
Once you receive your business loan agreement
You’ll want to ensure that you understand the terms and conditions — and address any questions or concerns you have with your lender — before signing.
Alternatives for startups with bad credit
Startups with bad credit may have more difficulty getting traditional business loans. If you’re looking for an alternative small-business financing
Personal business loans
Business credit cards
Friends and family loans
Startup business grants
Crowdfunding
Frequently asked questions
Can you get a guaranteed startup business loan with bad credit?
Can you get a startup business loan with a 500 credit score?
Do you need collateral to get a startup business loan with bad credit?
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.
To come up with our list of the best startup business loans for bad credit, we selected lenders with minimum time in business requirements of 12 months or less, minimum credit score requirements of 625 or less and strong NerdWallet star ratings.
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