Fundbox VS BlueVine: Compare Loans & Find Out Which Lender Is Right For Your Small Business
Fundbox and BlueVine are two popular financing services for B2B and B2C businesses. Both use technology to offer fast, hassle-free invoice financing and lines of credit to small businesses.
If you run a small business, especially one that processes invoices, you’ve probably heard of one or both of these companies. But while both provide excellent services, you only need one — so which do you choose?
In this article, we will compare Fundbox and BlueVine’s invoice financing and lines of credit in terms of business eligibility and the terms and fees offered.
Which is right for your business? Keep reading to find out!
Table of Contents
Fundbox VS BlueVine: Invoice Financing
Fundbox’s invoice financing service is called “Fundbox Credit,” whereas BlueVine’s is simply called “invoice factoring.”
Invoice financing is a B2B service in which businesses use their unpaid invoices to gain access to immediate cash. While BlueVine and Fundbox both offer invoice financing services, they differ based on technicalities. BlueVine offers invoice factoring, where the company purchases your unpaid invoices at a discount. In contrast, Fundbox merely uses the invoices as collateral. In either case, the amount of money you can access is based on the value of your unpaid invoices.
Because you have to have unpaid invoices to utilize Fundbox Credit or BlueVine’s invoice factoring services, only B2B businesses are eligible for these services. If you are looking for a sum of money that is not tied to invoices, you’ll want to look at the line of credit services below.
To qualify for invoice financing services from Fundbox or BlueVine, you’ll need to meet these qualifications:
Time In Business
$50,000 per year
$120,000 per year
Minimum Credit Score
At least 2 months of compatible accounting/invoicing software use
Must run a B2B or B2G business
As you can see, both Fundbox and BlueVine have low borrower requirements, which make them suited for many small businesses.
Fundbox is the easier of the two to qualify for. Fundbox requires that you have compatible accounting or invoicing software for at least three months. Fundbox currently works with 12 accounting and invoicing solutions, including popular vendors, such as Xero, QuickBooks, FreshBooks, and eBillity. Fundbox does not have any specific requirements about time in business or income, although annual revenue of at least $50,000 is recommended. Borrowers must have a credit score of 500 or above to qualify through Fundbox.
BlueVine’s borrower requirements are also very easy to meet. All you need is to have at least three months in business, bring in at least $120,000 per year in revenue, and have a credit score of 530 or above. BlueVine integrates with three invoicing and accounting services: FreshBooks, QuickBooks, and Xero. And even if you don’t use any of those programs, you can still use BlueVine’s services.
That said, the above are the minimum eligibility requirements for invoice financing services. As the company learns more about your business, there is a chance it will discover that you are not eligible for the service after all. However, provided you meet the above requirements, you have a good chance of qualifying.
With no specific time in business or revenue requirements, Fundbox is the easier of the two to qualify for (provided the accounting or invoicing software you use is compatible with the service). However, given the relatively low requirements, many businesses will also be eligible for BlueVine’s service. Read on to learn about the terms and fees for both services to find out which is a better fit for your business.
Terms & Fees
These are the terms and fees for BlueVine and Fundbox’s invoice financing services:
Up to $100,000
Starts at 4.66%
0.25%-1% per week
Possible $15 wire transfer fee (no ACH transfer fee)
12 or 24 weeks
13 weeks (91 days)
Recourse Or Non-Recourse
Notification Or Non-Notification
Are you feeling confused about what all this means? Take a look at our Basic Introduction To Invoice Factoring For Businesses. (But keep in mind that although borrowing amounts are based on your invoices, Fundbox’s service is not traditional invoice factoring but more like invoice financing).
Because of a few small technical differences, Fundbox and BlueVine’s services work in different ways. The biggest differences are in how much money you can borrow from a single invoice and how the funds get repaid.
Fundbox will grant you the entire value of the invoice, essentially using it as collateral to establish your maximum amount of credit. To repay, you’ll be making weekly fixed payments of a portion of the invoice value plus a borrowing fee. On the other hand, BlueVine will only grant you 85% to 90% of the value of an invoice and hold the rest in reserve. You do not have to make any payments; instead, BlueVine waits for your customer to pay. When that happens, BlueVine will deduct its fee from the reserve and send the remainder to your business.
Neither funder requires you to sign a long-term contract. Nor do they impose any monthly minimums or include other restricting clauses. Because BlueVine has a larger possible credit facility, it is the better option for businesses that want (and have the resources) to finance more than $100,000 worth of invoices at a time. However, if you want to finance less than $100,000, either service might be worth considering.
Overall, BlueVine offers potentially higher fees, but the amount charged will vary, depending on how each company calculates risk. Your rate will depend on the strength of your business, the details of your customers’ businesses, and the funder’s underwriting procedures.
Fundbox VS BlueVine: Lines Of Credit
Fundbox’s line of credit is called “Direct Draw,” while BlueVine offers two lines of credit, called “Flex6” and “Flex12.”
A business line of credit is a sum of money that is granted to businesses. The business can draw money from the credit line at any time. Draws are treated like small business loans — the outstanding balance accrues interest, and the money is repaid in fixed installments over a set period. Fundbox and BlueVine offer revolving lines of credit, which means that the amount of money you have available replenishes as you repay funds borrowed.
Because these lines of credit are not tied to invoices, both B2C and B2B businesses that qualify can use BlueVine and Fundbox’s lines of credit.
Below are the borrower requirements for Direct Draw from Fundbox and Flex6 from BlueVine:
Time In Business
$50,000 per year
$120,000 per year
Minimum Credit Score
At least 3 months of compatible bank account use
Both products are slightly more difficult to qualify for than their invoice financing counterparts. Note that the above requirements are for Flex6, BlueVine’s line of credit with a six month repayment period. Flex12 is a bit more difficult to qualify for — check out our full BlueVine review for details.
Fundbox requires that you have been using a compatible business bank account for at least six months. I wouldn’t be too worried about using an incompatible business account — the company integrates with over 24,000 banks and credit unions across the country. Fundbox also requires a minimum credit score of 500 for all borrowers.
BlueVine has a few more requirements, but most businesses should be able to easily meet them: You have to be in business at least six months, make $120,000 or more per year, and have a credit score of 600 or above. BlueVine’s lines of credit aren’t available in some states. Check our full review of BlueVine to see if your state is eligible.
You must have been in business (or in Fundbox’s case, have a business bank account) for at least six months to qualify for either service. If you make less than $120,000 per year or have a credit score below 600, you will only be eligible for Fundbox’s service. If you meet or exceed those requirements, you have a good chance of qualifying for either service.
Terms & Fees
Below is a comparison of the terms and fees for BlueVine and Fundbox:
6 or 12 months
Starts at 4.66% of the borrowing amount
0.3%-1.5% per week (for a 6-month LOC)
1.2%-2.5% draw fee
As you can see, BlueVine has a larger possible credit facility. You might be able to qualify for a maximum of $250,000 from BlueVine, whereas $100,000 is the most Fundbox will extend. Naturally, the amount offered to you is dependent on the strength of your business financials.
BlueVine’s term lengths are much longer than Fundbox’s. While you will have to repay your draws in 12 weeks or 24 weeks (or about three to six months) for a Fundbox loan, borrowers will have six or 12 months to repay BlueVine draws. A longer time to repay means that you will have lower weekly or monthly payments.
Price is one area where Fundbox appears better than BlueVine, at least on paper. Fundbox’s effective APR maxes out at 54%, whereas BlueVine’s can reach 78%. Additionally, Fundbox does not carry a draw fee. In contrast, BlueVine will deduct 1.2%-2.5% of the value of the draw before sending you the money. However, although Fundbox has a lower possible range, remember that your rate will be dependent on the strength of your business. Because each company has its own way of evaluating risk, you might be offered a lower rate from either company.
BlueVine grants access to a larger possible credit facility and longer times to repay (which translates to smaller weekly or monthly payments). Although Fundbox has a lower possible APR and no extra fees, your rates for both lines of credit will depend on the strength of your business. Either lender could offer your business a lower rate because they calculate business strengths and risks differently.
As a general rule, Fundbox is intended for small businesses processing smaller amounts of money; BlueVine is better for businesses that want larger sums.
Fundbox Credit and Direct Draw are very easy to qualify for, but borrowers won’t have access to as much money as they might be able to get from other sources.
BlueVine can be used by larger businesses and offers particularly suitable invoice factoring services for big organizations, with credit facilities potentially as large as $5,000,000.
Choose Fundbox if:
- You have a personal credit score below 530 (or below 600 for a line of credit)
- Your monthly revenue is below $10,000
- You use accounting/invoicing software that integrates with Fundbox
- You want to repay invoice draws weekly (instead of waiting for your customer to pay their invoice)
- You don’t need a large credit line
- You only need to redeem an invoice occasionally
Choose BlueVine if:
- You have a personal credit score above 530 (or above 600 for a line of credit)
- Your monthly revenue is above $10,000
- You aren’t using compatible accounting/invoicing software or don’t want to integrate your software
- You need an invoice factoring credit line above $20,000
- You need (and will qualify for) a line of credit above $100,000
- You need to sell a large volume of invoices
For more information on these services, read our full reviews of Fundbox and BlueVine. Still on the fence? Neither of these services charges fees until you redeem an invoice. Sign up for both, see your beginning rates and fees, and decide which one you like better.
If neither Fundbox or BlueVine seems right for your business, there are other financing options available to you. Consider Kabbage as another option for a flexible line of credit. With Kabbage’s low requirements, many business owners can easily qualify to receive the financing they need. You can also check out Lendio, a loan aggregator that provides multiple offers so that you can shop around for the best rates and terms. Through Lendio, you can apply for invoice financing, lines of credit, Small Business Administration loans, and other financial products.
Have you tried Fundbox, BlueVine, or both services? Which one do you prefer? Let us know in the comments!