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The Best Small Business Loans For 2021: Top Picks For Every Type Of Business

Take a look at our picks for the best small business loans for cash flow issues, business expansion, debt consolidation, bank financing, and other common business financing needs.

    Jason Vissers
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Advertiser Disclosure: Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity.
Small business loans

The beginning of a new decade offers us a chance to assess where we’ve been, where we are, and where we hope to be in the future. Even in times of pandemic and social unrest, businesses need a way to access capital when they need it. With the proliferation of online financing options out there, it’s easy to become overwhelmed when looking for the lender that best suits your particular business needs.

Let’s take a deep dive into the world of small business loans, so your business can tackle the ’21s the right way, even if it looks less like they’ll be “roaring” than “screaming.”

Learn More About Our Top Picks

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Best for small business loans and short/medium-term financing.
Best for small business loans and short/medium-term financing.

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Best overall option due to the variety of loans in Lendio's free business loan marketplace.
Best overall option due to the variety of loans in Lendio's free business loan marketplace.

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Best for receiving and comparing offers from multiple lenders.
Best for receiving and comparing offers from multiple lenders.

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The SBA loans offered via SmartBiz are great for expanding your business due to their low cost and lengthy terms.
The SBA loans offered via SmartBiz are great for expanding your business due to their low cost and lengthy terms.

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Best for smoothing out your cash flow due to the lender's multiple well-rounded cash flow solutions.
Best for smoothing out your cash flow due to the lender's multiple well-rounded cash flow solutions.

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Other Featured Options:

  • Fundbox: Best for business owners with bad credit, as the lender accepts applicants with credit scores as low as 600.
  • Fundation: Fundation's loans are ideal for debt consolidation, as they are offered with longer terms than most business loans.
  • Wells Fargo Business Loans: Wells Fargo offers a wider variety of business financing products than most other banks.
  • LoanBuilder: Best for young businesses -- LoanBuilder only requires nine months in business for you to qualify for a short-term loan.
  • Accion: Accion is one of the few lenders offering business loans to startups with no time in business.

Read more below to learn why we chose these options.

Best Small Business Loans For 2021

Businesses still recovering from 2020 may need capital more than ever. If you need a financial boost for your small business, start with these lenders. We looked at factors including time to funding, rates, borrowing requirements, and customer reviews to designate these small business lenders the best of 2021.

1. OnDeck: Best Short/Medium-Term Loans

OnDeck



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One of the original players in the online loans industry, OnDeck’s short-term loans and lines of credit offer businesses two short/medium-term financing solutions to get a handle on operating costs.

OnDeck doesn’t charge interest on its term loans. Instead, your repayment amount is a fixed rate. That means your repayment amount only gets calculated once. For example, if you are borrowing $50,000 with a fixed rate of 19%, you’ll be repaying $59,500 in total (plus fees). In addition to the factor rate, OnDeck also charges an origination fee, which is taken directly out of the principal before you get the loan. Borrowing amounts of up to $250,000 are available to qualified borrowers.

OnDeck also offers revolving lines of credit of up to $100,000 and term lengths of 12 months. Unlike OnDeck’s term loans, the company’s lines of credit do accrue interest, so you can save money by repaying the money early. There is no penalty for early repayment.

Pros

  • Multiple types of financing available
  • The application process is quick & easy
  • Funds are disbursed quickly

Cons

  • Rates can be expensive
  • Not available to businesses in some industries

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2. Lendio: Best Overall

Lendio



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Lendio is not an originator of loans, so you might be asking yourself why we’ve placed it atop our list of small business lenders.

Lendio’s business financing platform works like this: you provide Lendio information about yourself, your business, and the kind of financing you’re seeking. In turn, Lendio will send you loan offers from among the 75+ loan originators in its business financing network. You can then compare the loan offers you prequalify for and select the one that best fits your business circumstances. What’s more, Lendio’s business loan marketplace is completely free to use.

We put Lendio at the top of our list due to the sheer variety of loan options on offer through Lendio’s partners. All of the following are available via the Lendio platform:

  • Business lines of credit
  • SBA loans
  • Short-term loans
  • Business term loans
  • Merchant cash advances
  • Equipment financing

Lendio promises to send you eligible loan offers within 72 hours of applying. Once you get your loan offers, you’ll still have to go through the process of applying to a lender, so it’s not the most rapid business financing solution. However, given that Lendio does the work of finding business loan products suited to you, the convenience will be worth the wait for most borrowers. Furthermore, Lendio’s extensive lender network includes some lenders who are willing to work with would-be borrowers who have less-than-stellar credit (Lendio recommends a credit score of at least 550 for applicants).

Pros

  • Multiple types of financing available
  • High borrowing amounts
  • Low credit score requirements (for some products)

Cons

  • Application process can be slow
  • Funds can take a while to disburse
  • Rates can be expensive

Get Started with Lendio

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3. Fundera: Best Loan Matchmaker

Fundera by NerdWallet



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If you want to browse before you commit to a loan, Fundera simplifies the process. Fundera isn’t a direct lender but instead offers a loan matchmaking service. Simply input your information, and Fundera helps you find and compare lender offers.

Fundera isn’t the only loan matchmaker in the industry, but it stands out for a few reasons. Fundera has fewer lending partners than its competitors. On the surface, this may seem like a disadvantage but Fundera places value on quality lenders, so you don’t have to worry about being paired with a shady lender. Fundera also has excellent customer service, a variety of financing products, and even options for new businesses or credit-challenged borrowers.

Fundera offers a variety of loan products, including installment loans, SBA loans, and business lines of credit. Rates, terms, and fees vary based on the lender and financial product you select, but you’ll be able to quickly and easily compare your options so you can choose the best for your business. Fundera also offers excellent customer support that can help you throughout the process, and if you aren’t eligible for any offers now, Fundera has an eligibility tracker that can notify you when you may be eligible in the future.

Pros

  • Multiple types of financing available
  • Long-term financing options available
  • Application process is fast & easy

Cons

  • Rates can be expensive
  • Some additional fees are charged

Get Started with Fundera by NerdWallet

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4. SmartBiz: Best For SBA Loans

SmartBiz



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Like Lendio and Fundera, SmartBiz doesn’t originate loans. But while Lendio matches you up with online vendors offering a wide variety of loan products, SmartBiz’s network of bank lenders provide SBA loans. As SBA loans tend to be low-cost and long-term, SmartBiz is an especially attractive option for qualifying businesses looking to expand.

SmartBiz’s SBA loans aren’t for startups; two years in business are required to qualify. These SBA loans are offered in three different types: debt refinancing loans, working capital loans, and commercial real estate loans.

The working capital and debt refinancing SBA loans offered through SmartBiz have a term length of 10 years and an APR around 10%. Not too shabby, eh? You can borrow up to $350,000 with these loans.

SmartBiz’s commercial real estate loans are offered for up to $5 million with term lengths of 25 years. Of course, most of you probably aren’t looking for commercial real estate loans!

Pros

  • High borrowing amounts
  • Rates tend to be inexpensive
  • Long-term financing options available

Cons

  • Borrower qualifications might be hard to meet
  • Funds can take a while to disburse

Get Started with SmartBiz

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5. BlueVine: Best For Improving Cash Flow

BlueVine



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BlueVine is a business lender best known for its invoice factoring — a type of business financing in which a B2B (or B2G) business sells its unpaid invoices at a discount in exchange for immediate cash. For B2B businesses suffering from inconsistent cash flow, BlueVine’s invoice factoring provides a good way to smooth things out. And with BlueVine, there are no long-term contracts to sign or extra fees to pay.

If your business doesn’t process invoices, BlueVine offers lines of credit and term loans as well. The latter two products are available to both B2B and B2C businesses.

With BlueVine, you can apply for financing and get funded in as little as 24 hours. Combine that with BlueVine’s relatively relaxed borrower qualifications (you can qualify for invoice factoring with a credit score of just 530), and BlueVine makes a great case for itself as a remedy for your business’s cash flow issues.

Pros

  • Low credit score requirements
  • No long term contract required
  • Funds are disbursed quickly

Cons

  • Rates can be expensive
  • Repayments are required quickly

Get Started with BlueVine

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6. Fundbox: Best For Bad Credit

Fundbox



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Fundbox is a lender with low borrower requirements that make it an excellent place to seek funding for businesses (or even freelancers) with as little as six months in operation (although, ideally, a full year in business). Fundbox also lends to business owners with credit scores as low as 600. You’ll be hard-pressed to find another business lender with such relaxed requirements.

Fundbox’s revolving line of credit product is called Direct Draw. Fundbox evaluates your bank account activity when you apply for Direct Draw. You’ll need to have been using a compatible bank account for at least three months before applying. The borrowing fee begins at 4.66%, term lengths are 12 or 24 weeks, borrowing amounts run from $1K to $150K, and there is no prepayment penalty.

Pros

  • Low credit score requirements
  • Two types of financing are available (term loans and lines of credit)
  • Funds are disbursed quickly

Cons

  • Rates can be expensive
  • No long-term financing options are available

Get Started with Fundbox

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7. Fundation: Best For Debt Consolidation

Fundation



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Fundation is one of our favorite players in the alternative lending industry, offering competitive rates and excellent customer support. As it happens, Fundation is great for business owners looking to consolidate debt, as the company offers loans with term lengths of up to four years — longer than most other vendors operating in this space.

You can borrow up to $500,000 with Fundation’s installment loans, with payments due on a biweekly basis. Fundation also offers lines of credit of up to $150,000, with each draw subject to a 2% fee and a repayment period of 18 months. Draws from your line of credit are repaid monthly.

Fundation’s borrower requirements are on the stringent side — you’ll need 12 months of business history, at least $100K a year in business revenue, a personal credit score of at least 660, and at least three full-time employees at your business. Yes, you can count yourself!

Pros

  • Monthly & bi-weekly repayments
  • Long-term financing options available
  • No prepayment penalties

Cons

  • Borrower qualifications might be hard to meet
  • A blanket lien is required

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8. Wells Fargo: Best For Traditional Bank Loans

Wells Fargo Business Loans



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Over the last decade or so, a number of scandals have tarnished Wells Fargo’s brand. However, if you decide to seek a loan from a traditional bank, the business loans offered by Wells Fargo merit consideration. The banking giant offers a wide array of financing products for businesses:

  • Secured and unsecured business loans
  • Lines of credit
  • SBA loans
  • Invoice factoring
  • Commercial lending

Thankfully, you don’t have to go into a Wells Fargo branch to apply — you can do so online.

Wells Fargo’s borrower requirements for business loans are generally pretty steep. Your business must have a two-year record of profitability and at least $1.50 in cash flow for every $1 borrowed. You must also have a personal credit score of at least 640.

Pros

  • Multiple types of financing available
  • Rates tend to be inexpensive
  • Long-term financing options available

Cons

  • Borrower qualifications might be hard to meet
  • Funds can take a while to disburse

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9. LoanBuilder: Best For New Businesses

LoanBuilder



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Small business lender LoanBuilder was acquired by PayPal in 2017 and is sometimes marketed as PayPal Business Loans. The lender specializes in short-term business loans that carry fixed fees instead of interest.

For new businesses just starting, LoanBuilder’s advantage is that the lender only requires nine months of business time. Most business loan vendors require 12 months or more of business history. You’ll also need revenue of $42,000+ a year and a personal credit score of 620 or above.

Borrowing amounts run from $5K to $500K. Term lengths range from 13 to 52 weeks, and the borrowing fee is a one-time fee of 2.9%-18.72% of the borrowing amount.

Pros

  • Borrower qualifications are lower than banks
  • Low credit score requirements
  • No extra fees

Cons

  • No long-term financing options available
  • A blanket lien is required

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10. Accion: Best For Startups

Accion



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We here at Merchant Maverick have been fans of Accion for some time. This nonprofit is one of the very few vendors of business loans that do not require any time in business at all for loan qualification, making Accion an ideal funding solution for startups.

Do note that you’ll need a personal credit score of at least 550-575 to qualify, however. Startups must also meet a few additional requirements:

  • Have less than $3,000 in past-due debt
  • Have a business plan with a 12-month cash flow projection
  • Have a partner referral (such as SCORE or SBDC)

Accion’s small business installment loans carry an interest rate of 7%-34%, borrowing amounts from $300 to $250K, and an origination fee of 3%-5%.

Pros

  • Borrower qualifications are lower than banks
  • Financing is available to qualified startups
  • Monthly repayments

Cons

  • Rates can be expensive
  • Some additional fees are charged

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How We Chose Our Top Picks

When reviewing business financing products, Merchant Maverick gathers and examines pertinent data points on each lender (interest rates, term length, fees, borrower requirements, customer reviews, etc.), compares the lender to other similarly situated companies in the industry, and assigns the lender a score based on our research.

For this list, we’ve pinpointed some of the primary motivations for seeking business financing, identified the lenders who best fulfill those motivations based on the data we’ve collected, and presented them to you! Of course, we encourage you to compare business lenders to find the product that best suits your business needs, but we hope this list provides you with a well-substantiated starting point in your search.

More Small Business Loan Resources

2020 threw a wrench into the plans of many small business owners, leaving many anxious as to what 2021 would hold. Fortunately, though, there are lots of financing options available, whether you’re trying to recover from last year or you’re ready to take your business to the next level.

Before you jump into getting a small business loan, make sure you understand the process from end-to-end: from finding a lender and filling out an application to repaying your loan. Learn what you need to qualify for a small business loan, the steps you need to take to receive a loan, and check out our comprehensive and unbiased reviews to find the lender that’s right for you. Good luck!

In Summary: Best Small Business Loans For 2021

  1. OnDeck: Best for small business loans and short/medium-term financing.
  2. Lendio: Best overall option due to the variety of loans in Lendio's free business loan marketplace.
  3. Fundera by NerdWallet: Best for receiving and comparing offers from multiple lenders.
  4. SmartBiz: The SBA loans offered via SmartBiz are great for expanding your business due to their low cost and lengthy terms.
  5. BlueVine: Best for smoothing out your cash flow due to the lender's multiple well-rounded cash flow solutions.
  6. Fundbox: Best for business owners with bad credit, as the lender accepts applicants with credit scores as low as 600.
  7. Fundation: Fundation's loans are ideal for debt consolidation, as they are offered with longer terms than most business loans.
  8. Wells Fargo Business Loans: Wells Fargo offers a wider variety of business financing products than most other banks.
  9. LoanBuilder: Best for young businesses -- LoanBuilder only requires nine months in business for you to qualify for a short-term loan.
  10. Accion: Accion is one of the few lenders offering business loans to startups with no time in business.
Jason Vissers

Jason Vissers

Expert Analyst & Reviewer at Merchant Maverick
Jason Vissers has been researching, analyzing, and writing about small business software and finance since 2015. His financial expertise has been cited in numerous publications, including The Ladders. Jason graduated with a Political Science degree from San Diego State University in 2001.
Jason Vissers
View Jason Vissers's professional experience on LinkedIn.

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5 Comments

Responses are not provided or commissioned by the vendor or bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the vendor or bank advertiser. It is not the vendor or bank advertiser's responsibility to ensure all posts and/or questions are answered.

    okereke sunday

    I need a loan so that I can start a business of motor spare parts

      This comment refers to an earlier version of this post and may be outdated.

      Jessica Dinsmore

      Thanks for stopping by! We hope you find some helpful resources while you are here–this post on starting and funding an automotive business might have some relevant recommendations for you. Good luck to you!

        This comment refers to an earlier version of this post and may be outdated.

        Abdelkader Bokstrom

        Excellent raisonnement et un vivier de conseils et bien évidemment des recommandations positives pour les businessmen .Bravo bonne continuation

        Excellent reasoning and a pool of advice and of course positive recommendations for businessmen.

          This comment refers to an earlier version of this post and may be outdated.

          Gary J Buzzerio

          I had my 2019 taxes done by h n r block and I’m a 1099 person. I was told I can get a ppp loan but I really don’t know how to get it done. Wondering if someone can help me get One with my 2019 taxes and my 1099. My number is 910 479 8830. Thank you. Gary Buzzerio

            This comment refers to an earlier version of this post and may be outdated.

            Jessica Dinsmore

            Hi Gary,

            We have a post on PPP loans for self-employed that can help you with navigating the application process. And 2019 taxes are sufficient for the application. I hope that helps! Best of luck.

              This comment refers to an earlier version of this post and may be outdated.

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            We Recommend OnDeck for Loans 🏆

            Fast turnaround: as little as 1 - 2 days.
            Low requirements: 600+ credit score, 12+ months in business and $100,000+ revenue.

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            Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity. The editorial content on this page is not provided by any of the companies mentioned and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author’s alone.

            The vendors that appear on this list were chosen by subject matter experts on the basis of product quality, wide usage and availability, and positive reputation.

            Merchant Maverick’s ratings are editorial in nature, and are not aggregated from user reviews. Each staff reviewer at Merchant Maverick is a subject matter expert with experience researching, testing, and evaluating small business software and services. The rating of this company or service is based on the author’s expert opinion and analysis of the product, and assessed and seconded by another subject matter expert on staff before publication. Merchant Maverick’s ratings are not influenced by affiliate partnerships.

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