Poor Cash Flow? Consolidate Your Business Debt

Small Business, Small Business Loans
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NerdWallet spent numerous hours reviewing lenders, vetting their application processes and understanding their borrowing terms. We’ve highlighted their qualifications and rates so that you can accurately compare products based on your needs and goals.

For the financially savvy small-business owner looking to free up some extra cash, consider refinancing or consolidating loans with high interest rates.

Nearly a quarter of businesses that applied for funding during the second half of 2016 sought to refinance existing debt, according to the Federal Reserve’s Small Business Credit Survey released in 2017.

Refinancing or consolidating could lower your monthly payments and help you grow your business, but before you get started, you need to understand the difference between the two financing strategies.

  • Debt consolidation combines several loans or merchant cash advances into one loan, which could result in lower payments
  • Debt refinancing means you take out a lower-interest loan and use it to pay off the original to save money

Besides banks, you can turn to online alternative lenders for business debt consolidation and refinancing. Here are our top four recommendations, ranked by cost of financing.

Business debt consolidation loans: Compare options


 smartbizfundingcirclecredibilitycapitallogoAble Lending logo
Best forThe lowest rates

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Businesses with low revenue

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Businesses that are at least 1 year old

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Businesses with a strong network of friends and family

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Loan Details
Loan amount$30,000 - $350,000$25,000 - $500,000$10,000 - $350,000$25,000 to $1 million
APR8.5% - 9.21%7.4% - 36%10% - 25%8% - 25%
Minimum Qualifications
Personal credit score
  • Under $150,000: 600
  • Over $150,000: 650
Annual revenue$50,000None$100,000$100,000
Time in business2 years2 years1 year1 year
Apply now at SmartBiz
Apply now at Funding Circle
Apply now at Credibility Capital
Apply now at Able Lending

1. SmartBiz: For the lowest rates

When combining your business debt into one bundle, you want the lowest possible annual percentage rates. That makes SmartBiz your most attractive option. The online platform connects business owners with loans backed by the Small Business Administration, which have the most competitive rates on the market.

Pros: Low rates on SBA loans

Cons: Requires strong personal credit and business performance; tedious, paperwork-intensive application process

  • Loan amount: $30,000 to $350,000
  • APR: 8.5% to 9.21%
  • Loan term: 10 years
  • Funding time: As quickly as seven days but typically several weeks
  • Read our SmartBiz review
Apply now at SmartBiz

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2. Funding Circle: For businesses with low revenue

Established businesses looking for competitive APRs and fast cash might want to check out Funding Circle. Its application process takes about 10 days but is still faster than at SmartBiz, making it a solid option for healthy businesses looking for quick financing.

Pros: Low APRs for borrowers with good credit; flexible term lengths; no minimum revenue required

Cons: Young businesses and borrowers with poor personal credit won’t qualify

  • Loan amount: $25,000 to $500,000
  • APR: 7.4% to 36%
  • Loan term: One to five years
  • Funding time: Average of 10 days
  • Read our Funding Circle review
Apply now at Funding Circle

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3. Credibility Capital: For businesses that are at least 1 year old

Credibility Capital offers short-term financing — one, two or three years — to companies with good credit, making it a valid option for businesses looking to refinance expensive debt. Three years is the shortest maximum repayment period among the lenders in our list.

Pros: Competitive APRs; no prepayment penalty; need at least 650 personal credit score to qualify

Cons: Not for long-term financing

  • Loan amount: $10,000 to $350,000
  • APR: 10% to 25%
  • Loan term: One, two or three years
  • Funding time: Seven days on average
  • Read our Credibility Capital review
Apply now at Credibility Capital

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4. Able Lending: For businesses with a strong network

Able offers business loans of up to $1 million that can be partly subsidized by your friends and family, making it a good choice if you’ve rounded up a loyal customer base. Under the Able Growth loan model, Able picks up the rest of the financing after your backers’ contributions. Able also offers a conventional loan it originates 100%.

Pros: You can solicit friends and family to back part of your loan

Cons: Not for borrowers with bad credit or low revenue; funding speed dependent on how quickly backers commit funds

Able Lending logo
  • Loan amount: $25,000 to $1 million
  • APR: 8% to 25%
  • Loan term: One to five years
  • Funding time: Up to seven days for Able-funded loans; up to one to two days after full backer contribution for Able Growth loans
  • Read our Able Lending review
Apply now at Able Lending

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Find and compare small-business loans

NerdWallet has created a list of the best small-business loans to meet your needs and goals. 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.

Updated Sept. 11, 2017. 

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