The Best Alternatives To Fundbox
When small business owners need a flexible option for funding business expenses, a line of credit fits the bill. Unlike traditional loans that provide a lump sum of capital, lines of credit allow borrowers to draw money as needed up to the credit limit set by the lender. If the line of credit is revolving, funds are replenished as the borrower pays down the balance, giving the borrower consistent access to the capital they need to grow their business.
While banks offer lines of credit, these are typically difficult to qualify for, and the application processes can be lengthy and confusing. More small business owners are bypassing traditional lenders in favor of alternative lenders that offer quick approvals and easy applications — lenders like Fundbox.
What Is Fundbox?
Over 100,000 small businesses have used Fundbox to boost their business capital. Unlike banks, Fundbox has an easy application process. Fundbox provides credit decisions in just minutes, and if approved, you can immediately initiate your first draw and have cash in your bank account in as little as one business day. Fundbox has a transparent fee structure, and you only pay when you make a draw. Pay your balance back early and Fundbox waives all remaining fees, helping you lower your cost of borrowing.
One of the best things about Fundbox is the lender’s relaxed borrower qualifications. Approval is based on the performance of your business, so businesses that have trouble qualifying elsewhere may have success in obtaining a Fundbox line of credit. During the application process, you’ll sync your business bank account so Fundbox can analyze the performance of your business. If you have outstanding invoices, you can qualify for a line of credit through Fundbox’s invoice financing service by syncing your supported accounting software. Learn more by checking out our full review of Fundbox.
Although there are many benefits to using Fundbox, this lender isn’t the right choice for every business. With a maximum borrowing amount of $100,000, Fundbox may not offer enough capital for larger businesses. Maybe Fundbox’s weekly payment schedule doesn’t work for your business, or you want longer than the maximum repayment terms of 24 weeks. If you have an established business and a high personal credit score, you may qualify for other options with more affordable terms than what is offered through Fundbox.
Whether Fundbox doesn’t quite fit your needs or you’re just shopping around, there are similar lenders that may work better for your financial situation. In this post, we’ll explore alternatives to Fundbox to help you make the wisest financial choice for your business.
OnDeck is similar to Fundbox in many ways. This alternative lender offers a quick and simple online application that doesn’t require piles of paperwork. In fact, all you need in most cases is some basic business and personal information, your business tax ID and social security number, and business bank account statements. After submitting your application, you can receive a decision in just a few minutes.
OnDeck offers lines of credit up to $100,000. If you need more money, you may qualify for OnDeck’s term loans with maximum borrowing limits of $500,000 and terms up to 36 months. OnDeck has just one financing application and will determine which product best fits the needs of your business. Repayments are made on a daily or weekly schedule.
One thing that stands apart about OnDeck’s lines of credit is Instant Advance. With Instant Advance, approved borrowers with eligible debit cards can receive their funds in just minutes. Automated Clearinghouse (ACH) transfers are also available, and borrowers will receive funds typically in 1 to 2 business days.
OnDeck has low borrower requirements, but personal credit score is a factor for approval. All applicants must have a score of at least 600 to qualify for OnDeck’s term loans or lines of credit. Borrowers must also be in business for at least a year and have at least $100,000 in annual revenue.
StreetShares is a veteran-founded small business lender that once focused on other veteran-owned business. Today, any business owner can apply to receive funds through one of StreetShares’ three financial products: lines of credit, term loans, and contract financing.
If you need a line of credit larger than the maximum $100,000 offered through Fundbox, StreetShares might be a good option for you. This lender provides lines of credit with limits up to $250,000 for qualified borrowers. This option allows you to draw funds as needed and only pay interest on what you’ve borrowed. If you want your money as one lump sum, you may qualify for up to $250,000 with a term loan. StreetShares’ loans and lines of credit each have terms up to 36 months for businesses that want longer repayment terms.
StreetShares also offers contract financing — a product that’s similar to invoice financing. You can receive up to 90% of your invoices upfront with no limitations on the contract amount. This could be an ideal solution for borrowers that want to borrow money now against their unpaid contracts.
Like Fundbox and other lenders on this list, StreetShares has a simple online application process. You can be pre-approved in just minutes with minimal information. However, you may be required to provide additional documentation during the underwriting process, including financial statements and tax returns. All borrowers must have a time in business of at least one year, annual revenue of at least $100,000, and a credit score of at least 600. One last thing to note is that StreetShares only allows you to borrow up to 20% of your annual revenue.
Kabbage is very similar to Fundbox, offering lines of credit with very lenient borrowing requirements. Like Fundbox, Kabbage bases its approvals on the performance of a business, so Kabbage may be a good option for credit-challenged borrowers.
Despite its similarities, though, there are some key differences that could make Kabbage the more appealing option for your business. For starters, Kabbage offers higher maximum limits for its lines of credit — up to $250,000 compared to just $100,000 with Fundbox. Kabbage also offers monthly payments, which may work better for your needs than Fundbox’s weekly repayments.
Kabbage’s lines of credit can be repaid over 6, 12, or 18 months. Kabbage offers simple, transparent monthly fees only for the amount you’ve borrowed, and you can save on the cost of borrowing by repaying early. Borrowers may receive better rates and terms with Kabbage than Fundbox, but Fundbox may be the less expensive option for other borrowers. If you qualify for Kabbage, you can also receive the Kabbage Card, which allows you to instantly access your line of credit without waiting for transfers.
The application process for Kabbage is fast, and you can be approved and access your funds just minutes after applying. Minimal information is required to apply, and there are no minimum credit score requirements. You must, however, have a time in business of at least one year and at least $50,000 in annual revenue.
Shopping your options? Give Lendio a try. With just one application, you can receive offers from over 75 lenders, making it easy to find the best loan for your situation. Lendio’s network of lenders offer many different types of funding, including lines of credit.
You can receive up to $500,000 through Lendio’s network as a line of credit, which is significantly more than the limits of Fundbox’s financial product. Interest rates start at 8%, although some borrowers may receive interest rates as high as 24% based on a number of factors including, but not limited to, credit profile. Typical loan maturity for a line of credit obtained through Lendio is one to two years.
Qualifying for a line of credit through Lendio’s network is simple. Minimum borrower requirements include at least $50,000 in annual revenue, a time in business of at least six months, and a personal credit score of at least 560. However, to get the highest borrowing amount and lowest interest rates, you must have a higher credit score and a solid business performance.
Applying through Lendio is free and doesn’t have an impact on your credit, so it’s ideal for comparing your options. You may also decide that a line of credit isn’t right for your business, and you can get offers from lenders for other types of funding including Small Business Administration loans, accounts receivable loans, and business credit cards.
Like Fundbox, BlueVine offers a business line of credit. One of the main differences, however, is that you can borrow up to $250,000 through BlueVine. BlueVine also offers longer repayment terms of six or 12 months. Repayments are made on a weekly or monthly schedule.
However, it is more difficult to qualify for a BlueVine line of credit. The minimum requirements include a personal credit score of at least 600, minimum annual revenue of at least $100,000, and a time in business of at least six months.
In addition to its lines of credit, BlueVine also offers an invoice factoring service. This is ideal if you have outstanding invoices and need more money than is offered through a line of credit. You can receive up to 90% of your outstanding invoices, with lines up to $5 million. Once the invoice is paid, you’ll receive the remaining balance, minus BlueVine’s fees, which start at 0.25% per week. To qualify, you must have a B2B business that has been in business for at least three months. You must also have annual revenue of at least $100,000 and a personal credit score of at least 530.
Finally, you can also receive a term loan through BlueVine. You can borrow up to $250,000 as one lump sum that is repaid weekly over a period of up to 12 months. There are no origination fees, and you can receive your funds in as little as a few hours.
While there are some benefits to using Fundbox — think low borrower requirements and fast funding — this lender may not be the best choice for your business. Before you put your name on any agreement, make sure to compare your options to find the best rates and terms based on the needs of your business. Take the time to do your research, shop around, and make sure you understand the full cost of borrowing no matter what lender you select.