Kapitus Business Loans: Multiple Options But Stiff Qualifications
Kapitus provides short-term loans and merchant cash advances for established entrepreneurs with strong revenue, but factor rates may make it hard to compare loan options.
The bottom line:
Kapitus offers fast funding and high borrowing limits, but its factor rate-based pricing and frequent repayment schedule may not suit every business owner.
Loan details
Min. Loan Amount
$10,000
Min. Term Length
6 months
Max Loan Amount
$750,000
Max Term Length
24 months
Qualifications
Min. credit score
625
Min. Time in Business
24 months
Min. Annual Revenue
$250,000
Pros & Cons
Pros
Offers a variety of business financing options.
Can be used to build business credit.
No prepayment penalties.
Offers daily, weekly or monthly repayment options.
Cons
Factor rates make it difficult to compare loan options.
Qualification criteria is on the high end compared with other online lenders.
You may need to contact a representative to activate your online loan dashboard.
Editor's note: While Kapitus offers other types of business loans, this review focuses on its business term loan and merchant cash advance.
Founded in 2006, Kapitus is an online lender that offers short-term small-business loans and merchant cash advances. Its term loan provides up to $750,000 in working capital to cover everyday business expenses.
The lender’s merchant cash advance (MCA) allows business owners to access up to $5 million in funding. Repayments are based on a percentage of future credit or debit card sales. However, Kapitus’s MCA is relatively difficult to qualify for compared with other MCAs.
Consider Kapitus business loans if you:
- Have an established business. Applicants must have at least 24 months in business and generate $250,000 or more in annual revenue to qualify.
- Need access to large funding amounts. Kapitus offers up to $750,000 for term loans and up to $5 million for merchant cash advances, making it a good option for small-business owners financing big projects.
- Need fast cash. Borrowers in need of fast financing may access funding in as little as 24 hours.
- Have sufficient cash flow. Businesses that borrow a large short-term loan may struggle to meet higher repayments if their cash flow isn’t steady enough.
Not a fit? Consider these options instead.
How much do you need?
We’ll start with a brief questionnaire to better understand the unique needs of your business.
Once we uncover your personalized matches, our team will consult you on the process moving forward.
Kapitus loan details
Here’s what you can expect from Kapitus’s term loan and merchant cash advance.
Kapitus term loan
| Loan amount | $10,000 to $750,000. |
| Estimated factor rate | 1.10 to 1.45. |
| Fees |
|
| Terms | 6 to 24 months. |
| Repayment schedule | Daily, weekly or monthly. |
| Funding speed | As fast as 24 hours. |
Kapitus merchant cash advance
| Loan amount | Up to $5 million. |
| Estimated factor rate | Not disclosed. |
| Fees | Not disclosed. |
| Terms | On average, borrowers repay their advances in 6 to 24 months. |
| Repayment schedule | Daily, weekly or monthly. |
| Funding speed | As fast as 24 hours. |
Where Kapitus stands out
Fast financing
Kapitus may approve online applications in as little as four hours and provide funding within 24 hours. It may be an option for small-business owners in need of cash to cover emergency expenses.
» MORE: Best emergency business loans
High maximum funding amounts
Kapitus offers up to $750,000 for its term loan and up to $5 million for its MCA, which are higher than what many other online lenders offer. These high limits may be attractive to established business owners looking to seize time-sensitive business opportunities. But beware: MCAs are among the costliest forms of business financing. Borrowing at this level can result in a significant repayment burden.
Where Kapitus falls short
Factor rates make it difficult to compare offers
Unlike traditional interest rates that can be used to calculate an annual percentage rate (APR), Kapitus uses a factor rate for both its merchant cash advance and term loan. While common for an MCA, this is an unusual pricing model for a term loan. Factor rates make it harder to compare the true cost of financing against lenders that use APRs.
Convert factor rates to APRs
NerdWallet has built a calculator to help you convert factor rates to APRs. This can help you understand the true cost of financing before you commit. Give it a try!
» MORE: Merchant cash advance calculator
The MCA is difficult to qualify for
Merchant cash advances are typically seen as a last resort for small-business owners who can’t secure traditional forms of financing. However, Kapitus’s MCA has qualification criteria similar to those of traditional loans and business lines of credit.
If you can qualify for a Kapitus MCA, then, you’re actually better off applying for a different type of financing, either through Kapitus or another small-business lender. Check out the alternatives we recommend below.
Alternatives to Kapitus
iBusiness Funding
iBusiness Funding
iBusiness Funding - Online term loan
NerdWallet Rating
4.1
Min Credit
660
Apply now with Fundera by NerdWallet
iBusiness Funding is another online lender offering term loans to businesses with at least 24 months in operation. Unlike Kapitus, it charges a traditional interest rate for its term loan rather than a factor rate, and its repayment terms go up to 60 months. However, its term loan maxes out at $500,000 (lower than Kapitus’s maximum) and it requires a slightly higher minimum credit score of 660.
OnDeck
OnDeck
OnDeck - Online term loan
NerdWallet Rating
4.8
Min Credit
625
with Fundera by NerdWallet
For a more accessible online term loan, take a look at OnDeck. You can qualify with a minimum credit score of 625, only 12 months in business and a much lower annual revenue of only $100,000. Terms for OnDeck’s loan range up to 24 months. Note that OnDeck issues a maximum of $400,000, significantly lower than what Kapitus can offer. This one can also help you build your business credit.
Forward Financing
Forward Financing
Forward Financing - Merchant cash advance
Min Credit
500
with Fundera by NerdWallet
Forward Financing offers a more accessible merchant cash advance that may be a good fit for startups and business owners with bad credit. Its MCA requires just 12 months in business and a credit score of 500. Forward Financing caps funding at $500,000, though, which is much lower than Kapitus’s $5 million maximum.
» Want more options? Check out our list of best online business loans.