It can be difficult to qualify for business funding even with a good credit score. So, if your credit isn’t ideal, you might wonder if it’s even possible to get a business loan. Fortunately, some lenders may not require credit checks, but these types of funding can be more expensive than more traditional loans.
No credit check business loans are offered by lenders that typically don’t check your business or personal credit scores to determine loan approval. Or, similarly, those lenders aren’t concerned about bad credit — or no credit — and instead rely on alternative criteria to approve borrowers’ applications.
However, finding a lender that isn’t concerned with credit scores is somewhat hard to come by. Invoice financing or merchant cash advances are two options where lenders are more concerned with the creditworthiness of your customers rather than with you, but they also tend to be more expensive.
It’s harder to qualify for no credit check business loans, but it’s not impossible — especially if you can demonstrate the overall strength of your business. For example, if you have good cash flow, respectable revenues or have been in business for a couple of years, your chances of loan approval are strengthened, even with poor or no credit.
But you’re unlikely to get a loan with no credit check from a traditional bank or credit union. Instead, you’ll need to expand your search to online banks, fintechs or other non-traditional lenders. You may also be limited to only certain types of business financing, says Ryan Rosett, co-CEO and founder of Credibly.
“The most common type of loan that truly requires no credit check is a merchant cash advance, which is an agreement to purchase future revenue at a discount,” explains Rosett. “For working capital loans, usually a soft pull on credit is required for reputable lenders. There are many platforms out there and alternative lenders that will try to find financing for you without a credit check. However, most lenders will at least do a soft pull, which does not affect your credit score.”
Check out these lenders that offer business financing options where your credit isn’t a factor.
| Lender | Interest rate or fees | Loan Amounts | Term | Key requirements | |
|---|---|---|---|---|---|
| Olympus Lending | Not stated | Up to $250,000 | 1 to 48 months | $5,000 – $10,000 monthly revenue required (depending on loan type) | |
| Credibly | Factor rates start at 1.11, plus fees | $5,000 to $600,000 | 3 to 24 months | Must be in business at least 6 months | |
| Kiva | 0% | $1,000 to $15,000 | 6 months to 3 years | Borrowers required to personally enlist 5-50 investors (depending on loan amount) | |
| Square Loans | Fixed payback rate, not stated, plus processing fees | $100 to $350,000 | Uo to 18 months | Must be a Square seller | |
| FundThrough Invoice Factoring | 2.75% to 8.25% of the invoice value | Not stated — a percentage of outstanding invoices | 1 day - 61+ days | Need at least $100,000 in accounts receivables or in invoices to one customer | |
| PayPal Working Capital | Flat rate, not stated | Not stated | Must be a PayPal Business or Premier account holder for 90+ days | ||
| Clarify Capital Working Capital and MCA loans | Factor rates start at 0.05% | Up to $5 million | Not stated | 3 to 4 months recent business bank account statements required |
Most business loans require credit checks, especially from more traditional banks and credit unions. But the following are a few loan types that may not require a credit check or have very low credit requirements.
Rates for lenders that offer no credit check business loans vary, and they’re typically higher than rates for other types of business loans. Here is a ballpark range of what you might expect:
Olympus Lending is a “no credit needed” direct lender that offers term loans, equipment financing and invoice factoring. After filling out a fast online application, a representative contacts you to discuss loan options and terms. If approved, you could receive funding as soon as the next business day.
Credibly is a direct lender offering working capital loans and merchant cash advances. Rather than focusing on your credit score or more traditional lending criteria, it aims to consider your overall business health and potential. Credibly also provides funding in as little as 24 hours and offers other types of business loans through its partner network.
Kiva uses crowdfunded microloans to help fund small businesses. Loan amounts are small — with a maximum of $15,000 — but interest rates are 0%, and you have up to three years to pay it back. However, depending on your loan size, you have to enlist anywhere from five to 15 friends to invest in your business before the loan request is open to the public.
Square offers business loans to merchants that use the Square payment platform. Loan amounts range from $100 to $350,000, and how much you can borrow depends on your card sales through Square. Automatic repayments are deducted from your account daily at a set, undisclosed percentage. You’ll also have to pay processing fees.
FundThrough is a Canada-based lender that offers invoice factoring loans to US and Canadian businesses. Basically, you sell your outstanding invoices to FundThrough in exchange for cash. Then, it collects from your customers and returns the remaining balance to you, minus its fee. The system is fast and fully automated, but you need at least $100,000 in qualified outstanding invoices.
PayPal offers working capital loans with no credit check required. Loan amounts range from $1,000 to $250,000, and the exact amount depends on your sales volume. PayPal doesn’t have any hidden or late fees but charges a flat percentage of your sales toward repayment. A minimum payment is due every 90 days.
Among other loan types, Clarify Capital offers invoice factoring and merchant cash advances (MCAs). Invoice factoring has no personal credit requirement, and MCAs have a minimum credit requirement of only 500. Both types of business financing have loan amounts of up to $5 million, and factor rates start at 0.05%.
No credit check business loans aren’t always a good idea. For one thing, they are often some of the most expensive forms of business financing. And, some of these loan types just don’t make sense for all businesses.
Consider a no credit check business loan if you need fast, short-term financing, can manage the rigorous repayment schedules or don’t qualify for more traditional business loans.
It’s important to consider both the risks and rewards of business loans with no credit check.
Follow these five steps to find and apply for business loans with no credit check:
Other than the credit score requirements, eligibility is usually similar to that of traditional lenders. Lenders usually want to see that:
Some lenders may have additional requirements, such as a soft credit check — which won’t impact your credit score — or that you’re a US-based business. You may also have to provide a business plan or other financial documents in some cases.
If a no credit check business loan isn’t the right fit for your business, consider alternative types of funding that may not require credit checks or have low credit score requirements.
It can be more difficult to find business loans that don’t require a credit check, but you do have options. Consider merchant cash advances, invoice financing or factoring or equipment loans that may not require a credit check or have low credit score requirements.
It’s possible but not very likely. Most startup-friendly loans rely on the business owner’s credit to make up for your business’s short revenue record.
However, you might be able to get a microloan backed by the Small Business Administration — which has more lenient credit requirements — if you’re opening a business in an underserved area. But those lenders still check your credit.
You can, though your options are limited if your credit score is below 580. Consider looking into a secured business loan, which has a higher approval rate and offers more favorable rates and terms than you might otherwise be eligible for.
Loans with no credit checks often boast fast funding times, so it’s possible you could get funding as soon as the same day you apply. More realistically, however, you may get the funding on the next business day or within a few days.
Get access to an ongoing line of credit to finance invoices and business expenses. No paperwork required and no personal credit check.
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