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The 8 Best Square Capital Alternatives

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The 7 Best Square Capital Alternatives - Merchant Maverick

Square Capital (see our review) loans are, understandably, beloved by most Square users.

For the most part, Square has streamlined the typically drawn out and inconvenient loan process. With a Square Capital loan, you don’t have to spend time filling out long applications, gathering various documents, and remembering to write checks. It’s no wonder Square Capital is one of Merchant Maverick’s highest-rated short-term lenders.

However, Square Capital is not without its flaws. Some borrowers are frustrated that Square does not offer capital when they need it; it can also be inconsistent about when it offers the option to refinance with higher borrowing amounts. In short, because you typically have to wait for Square to offer the capital to you, the service can be undependable.

If you need capital, but Square Capital isn’t coming through for you, you may still have other options. The following eight lenders have similar borrower qualifications and offer similar products to Square Capital loans.

Best forLender
Loan Or LOC With A Fast Application ProcessOnDeck
Loans With A Fixed FeeLoanBuilder
Loan Or LOC For Working Capital Or Business Growth NeedsStreetShares
Loans For Working Capital, Inventory, Or Other Short-Term NeedsBreakout Capital
Invoice Factoring Or LOC For Consistent Cash FlowBlueVine
LOC For Working Capital Or Business GrowthKabbage
MCAs Or Short-Term Loans For Cash Flow Or Working CapitalFora Financial
Short-Term Or Installment Loans For Working Capital Or Business GrowthCredibly

1. OnDeck

Best For…

Small- to medium-sized businesses looking for a loan or line of credit with a fast application process.

Products Offered

  • Short-term loans
  • Lines of credit

Founded in 2007, OnDeck (see our review) was one of the first lenders to use technology to offer fast lending decisions. Even today, OnDeck is one of the fastest lenders available — many applicants will have money in their bank accounts within 24 or 48 hours of applying.

Review

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Here’s what to expect from an OnDeck short-term loan:

RequirementMinimum requirement
Borrowing Amount:$5,000 - $500,000
Term Length:3 - 36 months
Factor Rate:x1.003 - x1.042 per month
Origination Fee:0% - 4%
Effective APR:9.4% - 99.7%
Learn more about effective APRs
Collateral:UCC-1 blanket lien, personal guarantee

And here’s what to expect from an OnDeck line of credit:

RequirementMinimum requirement
Borrowing Amount:$6,000 - $100,000
Draw Term Length:6 months
Draw Fee:None
Maintenance Fee:Typically $20 per month
APR:11% - 63.2%
Collateral:Personal guarantee

How To Apply For An OnDeck Loan

Simply check your rate via OnDeck’s online application form. If you like the rates they’re offering, you may have to submit additional documents for verification or agree to a hard check on your credit. Typically, the loan can be fully approved and funded within one to two days.

Takeaway

OnDeck’s loans are perfect for small or medium-sized businesses that need funding quickly. With two types of funding — installment loans and lines of credit — most businesses will find something that suits their needs.

2. LoanBuilder

Best For…

Businesses looking for an easy-to-understand business loan with one fixed fee. 

Products Offered

  • Installment loans

LoanBuilder (see our review) offers installment loans that can be customized to fit the financial needs of your business. The LoanBuilder Configurator allows you to adjust your repayment terms and borrowing amount to find the most affordable payment. LoanBuilder also offers simple, transparent terms with one fixed fee, no origination fees, and no hidden charges.

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Check Eligibility

Here are LoanBuilder’s rates for installment loans:

Categoryrates fees

Borrowing Amount:

 $5,000 - $500,000

Term Length:

13 - 52 weeks

Borrowing Fee:

One-time fee of 2.9% - 18.72% of the borrowing amount

Origination Fee:

None

Effective APR:

 Learn more

Collateral:

UCC-1 blanket lien

How To Apply For A LoanBuilder Loan

Applying for a LoanBuilder loan is simple. Just fill out the online questionnaire to receive one or more loan offers. Checking your eligibility does not affect your credit score, although a hard pull will be performed if you proceed with the loan process. As you move through the process, you’ll be connected with a Business Funding Expert, who will let you know what documentation is needed and additional steps you need to take to receive your loan. Funding can be as soon as the next business day, although most borrowers will receive funds about one week after applying.

Takeaway

LoanBuilder offers loans with flexible terms and transparent fees for businesses that need extra funds to use as working capital or for other business expenses.

3. StreetShares

Best For…

Small- to medium-sized businesses looking for a loan or line of credit to be used for working capital or business growth needs.

Products Offered

  • Installment loans
  • Lines of credit
  • Contract financing

StreetShares (see our review) is a peer-to-peer lender that specializes in small business loans. Although the company was originally founded by a veteran to help other veterans, StreetShares works with non-veteran owned businesses as well.

Review

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StreetShares currently offers three types of financing: installment loans, lines of credit, and contract financing (a product similar to invoice factoring). Here are the rates for StreetShares installment loans: 

Column HeadingData

Borrowing amount:

$2,000 - $250,000

Term length:

3 - 36 months

Interest rate:

About 6% - 14%

Closing fee:

3.95% - 4.95%

APR range:

7% - 39.99%

Below are the rates and fees for the for StreetShares lines of credit. Check out our full review for a complete explanation of all three services.

Column HeadingData

Borrowing amount:

$5,000 - $250,000

Draw term length:

3 - 36 months

Interest rate:

About 6% - 14%

Draw fee:

2.95%

APR range:

7% - 39.99%

How To Apply For A StreetShares Loan

To check your eligibility, you will need to fill out a quick form on StreetShares’ website. If you’re qualified, you can go on to fill out a full application. When done, you will be presented with loan offers. The time from application to funding is generally less than a week.

Takeaway

StreetShares is a great choice for small and medium-sized businesses. In addition to relatively low borrower qualifications, this lender’s loans are flexible and easy to get.

4. Breakout Capital

Best For…

Small businesses in need of short-term loans to be used for working capital, inventory purchasing, or other short-term needs.

Products Offered

  • Short-term loans

Breakout Capital (see our review) is a short-term lender that focuses on offering specialized and fair funding to business owners. In general, the company offers short-term loans. However, Breakout’s loans tend to be more flexible than others on this list — depending on the strength and needs of your business, you may have a variety of payment schedules from which to choose. And because the company treats their loans a bit like lines of credit, you may be able to borrow additional capital if needed.

breakout capital

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These are the general terms for Breakout’s loans:

RequirementMinimum requirement
Borrowing Amount:Up to $250,000
Term Length:Up to 24 months
Fixed Fee:1.25% - 3.5% of the borrowing amount per month
Origination Fee:2.5%
Effective APR:Learn more
CollateralUCC-1 blanket lien, personal guarantee

How To Apply For Breakout Capital 

You can check your eligibility by filling out an online form or calling to talk to customer service. You’ll then have to provide some basic information and a few documents. Breakout Capital will let you know if you qualify for one of their loans. The cool thing about Breakout Capital is that they will also let you know if one of their lending partners has a better offer for you.

Takeaway

Breakout Capital offers fair and flexible financial products tailored to the needs of small business owners.

5. BlueVine

Best For…

Small businesses looking for invoice factoring or a line of credit for consistent cash flow.

Products Offered

  • Lines of credit
  • Invoice factoring

BlueVine (see our review) is known for revolutionizing and streamlining invoice factoring. If you don’t invoice your customers, however, BlueVine offers traditional lines of credit. As their borrower qualifications are lower than those of many other lines of credit on this list, BlueVine may be a good choice for very young businesses.

Review

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Here are the rates for BlueVine’s invoice factoring:

Column HeadingData

Credit facility size:

$20,000 - $5,000,000

Advance rate:

85% - 90%

Discount rate:

0.25% - 1% per week

Max overdue account:

13 weeks (91 days)

Additional fees:

$15 wire transfer fee (no charge for ACH transfers)

Contract length:

N/A

Monthly minimums:

No

Factor all invoices:

No

Recourse or non-recourse:

Recourse

Notification or non-notification:

Both

Here are the rates for BlueVine’s lines of credit:

Column HeadingData

Credit facility size:

$6,000 - $250,000

Term length:

6 or 12 months

Interest rate:

0.3% – 1.5% per week (Flex6)
1.5% – 6.5% per month (Flex12)

Draw fee:

1.2% – 2.5% per draw

APR range:

15% – 78%

Personal guarantee:

Yes

How To Apply For BlueVine

To apply, all you have to do is fill out an online application and provide some documents for verification. Typically, final approval takes 24 hours or less, after which you can start selling invoices or drawing from your credit line.

Takeaway

If you run a B2C business (or want a credit line that isn’t tied to your invoices), BlueVine’s line of credit work for businesses that need a source of cash, but have not yet been in business for a year. If you run a B2B business, BlueVine’s invoice factoring services are an easy and flexible way to get fast cash, even if you have slow-paying customers.

6. Kabbage

Best For…

Businesses looking for a line of credit for working capital or business growth needs.

Products Offered

  • Lines of credit

Kabbage (see our review) is a small business lender that offers lines of credit. Similar to OnDeck, Kabbage uses technology to make fast lending decisions. However, Kabbage may be even faster; borrowers can often check their eligibility and start drawing from their credit line as soon as the short online application is complete.

With fees that range from 1.5% – 12% per month (front-loaded, so you have to pay the bulk of the interest at the beginning of your loan), Kabbage’s lines of credit can be a little pricey. Nonetheless, the trade-off is often worth it for merchants who need an easy way to access cash.

Review

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Here are Kabbage’s rates:

RequirementMinimum requirement
Borrowing Amount:Up to $250,000
Draw Term Length:6 or 12 months
Borrowing Fee:1.5% - 10% of the borrowing amount per month
Draw Fee:None
Effective APR:24% - 99%
Learn more

How To Apply For A Kabbage Line Of Credit

Simply fill out an application on Kabbage’s website, or download the app and apply on your mobile device. Kabbage will request read-only access to your bank accounts and payment services like Square. When the application is complete, Kabbage will let you know how much you’re approved for and you can start drawing from your line immediately.

Takeaway

Although Kabbage’s loans can get expensive quickly, it’s an excellent option for businesses that need a dependable, easy-to-access source of additional cash.

7. Fora Financial

Best For…

Small businesses looking for a merchant cash advance or short-term loan for consistent cash flow or working capital.

Products Offered

  • Merchant cash advances
  • Short-term loans

Fora Financial (see our review) is a small business funder that offers merchant cash advances and short-term loans to eligible merchants. Although merchant cash advances often have a reputation for being non-transparent and predatory, Fora Financial dispels this stereotype by offering transparent customer service and relatively low rates (in comparison to others in the industry).

Review

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Here are the rates for Fora Financial’s merchant cash advances (MCA) and short-term loans (STL):

RequirementMinimum requirement
Borrowing Amount:$5,000 - $500,000
Term Length:No maturity date (MCA)
6 - 15 months (STL)
Fixed Fee:10% - 30% of the borrowing amount
Origination Fee:1% - 4%
Collateral:None
Effective APR:Learn more

How To Apply For Funding From Fora Financial

Fill out a contact form via the website, and somebody from Fora Financial will give you a call to discuss loan products, get information about your business, and give you a quote. If you like the numbers you’re quoted, you can continue the process by sending the requested documentation. The time from application to funding typically takes about four days or less.

Takeaway

Don’t let the merchant cash advance label scare you (after all, Square used to offer merchant cash advances as well). Fora Financial offers loans and advances that may be helpful for businesses in need of cash, and low borrower qualifications mean this solution may work for many small businesses.

8. Credibly

Best For…

Businesses in need of a short-term loan or installment loan for working capital or business growth projects.

Products Offered

  • Short-term loans
  • Installment loans

According to their website, Credibly‘s (see our review) mission is to provide the “right-sized capital” to grow your business. To do so, the lender offers short-term loans and installment loans to eligible borrowers.

Review

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These are the rates for Credibly’s fixed fee loans:

RequirementMinimum requirement
Borrowing Amount:$5,000 - $250,000
Term Length:6 - 17 months
Fixed Fee:9% - 36% of the borrowing amount
Origination Fee:2.5%
Effective APR:Learn more
Collateral:UCC-1 blanket lien, personal guarantee

And these are the rates for Credibly’s interest rate loans:

RequirementMinimum requirement
Borrowing Amount:$10,000 - $250,000
Term Length:18 - 24 months
Interest rate:9.99% - 36%
Origination Fee:2.5%
Effective APR:Learn more
Collateral:UCC-1 blanket lien, personal guarantee

How To Apply For A Credibly Loan

You can check your eligibility in a few minutes using Credibly’s online application. If you’re approved, you’ll need to submit business documents for verification purposes. A full application generally takes less than a week to be funded.

Takeaway

Credibly’s loans will work for small businesses that need capital for business growth projects.

What Type of Loan is Best for Me?

You may notice that the above lenders offer a variety of products: lines of credit, installment loans, short-term loans, and merchant cash advances. The right loan for your business will depend on what you’re eligible for and why you need the funds.

Installment loans, short-term loans, and merchant cash advances are sent to you in one lump sum. If you need additional capital after receiving the funds, you will need to apply for another loan or advance. These loans are best used for working capital or business growth projects.

If you get a line of credit, you will be able to draw up to your maximum borrowing amount at any time without reapplying. For this reason, lines of credit are especially helpful for solving cash-flow problems or capitalizing on time-sensitive business growth opportunities.

Read on for more information about each of these products:

Regardless of which you choose, these lenders differ from Square Capital in that you take the initiative to apply for the capital; you do not have to wait for the lender to extend an offer. Square Capital offers an inexpensive, convenient product, but if it’s not right for your business, these eight lenders may be the next best thing.

Looking for still more options? Check out a comparison of our favorite small business lenders, or our full list of reviews.

Chris Motola

Chris Motola

Finance Writer at Merchant Maverick
Chris Motola is a writer, programmer, game designer, and product of NY. These days he's mostly writing about financial products, but in a past life he wrote about health care and business. He's a graduate of the University of Central Florida.
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