OnDeck Small Business Loans Review

OnDeck may be expensive, but if you need a loan fast or don't qualify elsewhere, they are hard to beat.

Chris Motola
Expert Analyst & Reviewer
1 comment
Updated on: Aug 22, 2021

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OnDeck

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Total Rating	4.0
Interest Rates & Fees	Good
Application Process	Excellent
Sales & Advertising Transparency	Good
Customer Service & Technical Support	Excellent
Reviews, Complaints, & Testimonials	Excellent

Pros

Borrower qualifications are lower than with banks
Multiple types of financing available
Lower costs for repeat customers
The application process is fast and easy
Funds are disbursed quickly
Builds business credit

Cons

Financing isn’t available in some states.
Not available to businesses in some industries
Rates can be expensive

Jump to rates and fees or borrower qualifications.

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OnDeck Overview

OnDeck is a hugely prolific online small business lender. Currently, OnDeck offers two types of business loans: short-term loans and revolving lines of credit.

Businesses will most likely qualify for a loan from OnDeck if they have been in business for at least 2 years, make at least $250,000 annually, and have a personal credit score above 600. Those who are eligible will find that OnDeck’s loans are fast and helpful for a variety of business financing needs.

That said, OnDeck’s loans can be a bit expensive. APRs for OnDeck’s short-term loans can be as high as 98% with the average APR closer to 50%. Naturally, however, the rate offered to you will depend on the strength of your business. In addition to the cost, OnDeck loans have a maximum repayment term of 24 months, so those who need a more extended term length might want to look elsewhere.

Because OnDeck’s loans can be expensive, you may want to make some comparisons before settling on a lender. However, if you need a loan fast or don’t qualify elsewhere, it’s hard to beat OnDeck. Despite the potential drawbacks, OnDeck is transparent, customer service is easy to get in touch with, and overall, most customers report positive experiences.

Read on to learn more!

Table of Contents

Services Offered By OnDeck
OnDeck Borrower Requirements
OnDeck Interest Rates & Fees
Application Process
Sales & Advertising Transparency
Customer Service & Technical Support
OnDeck Reviews, Complaints, & Testimonials
Final Verdict

Services Offered By OnDeck

OnDeck offers term loans up to $250,000 and lines of credit up to $100,000. So how does OnDeck work? After filling out a short online application, you’ll be prompted to supply some documentation before accepting a loan offer and receiving your loan. Repayments are via ACH (daily or weekly).

OnDeck’s term loans are quick and easy to apply for, and you may even be able to get your funds the same day your loan is approved. OnDeck also offers lower borrowing rates and other benefits, such as waived fees, to repeat customers.

OnDeck also offers revolving lines of credit, which are similarly fast and simple to qualify for — just fill out the application. Once you are approved, you can withdraw funds at any time, and there are no draw fees or penalties for repaying early.

OnDeck Borrower Requirements

Here are the minimum qualifications required to be eligible for a short-term loan or line of credit from OnDeck:

Time In Business:	2 years
Credit Score:	600
Business Revenue:	$250,00 per year

Additionally, you must make at least five bank transactions per month to a business bank account, and your business cannot be in one of the restricted industries listed by OnDeck.

OnDeck currently does not lend to Nevada, North Dakota, or South Dakota.

OnDeck Interest Rates & Fees

Rating: Good

Let’s take a closer look at OnDeck’s rates and fees.

Term Loans

These are the terms and fees for OnDeck’s term loans:

Borrowing Amount:	$5,000-$250,000
Term Length:	Up to 24 months
Origination Fee:	0%-5%
APR:	As low as 35%; Average is 54.96%
Collateral:	UCC-1 blanket lien, personal guarantee

OnDeck’s term loans start at a 35% APR, but the average borrower will get something closer to 54.96%. Payments are made on a daily or weekly basis. There’s no penalty for pre-payment, meaning that if you pay off your loan early, you’ll pay less in interest than you would on the regular repayment schedule.

Aside from interest, the only fee OnDeck charges is an origination fee. This is taken directly out of the principal before you get the loan. So if you have a $10,000 loan with a 2.5% origination fee, OnDeck will take $250, and you’ll get $9,750.

Additionally, for returning customers who renew with OnDeck, OnDeck offers loyalty benefits, in which it will waive all remaining fees on your existing loan if you choose to apply for a new loan (and your current loan is at least 50% paid down). OnDeck may also offer a lower or 0% origination fee for repeat customers.

Lines Of Credit

Here are the stats for OnDeck’s lines of credit:

Borrowing Amount:	$6,000-$100,000
Draw Term Length:	Up to 12 months
Draw Fee:	None
Maintenance Fee:	Typically $20 per month
APR:	As low as 35.9%; average is 47.14%
Collateral:	Personal guarantee

OnDeck offers revolving lines of credit. Credit lines are a maximum of $100,000; you can draw from your line at any time. Funds replenish as you pay them back, and you repay a percentage of your total borrowed amount each week. Its credit lines are not tied to specific collateral or intended to be used for a specific purpose.

Term lengths are 12 months per draw, and you can repay early without penalty. OnDeck’s lines of credit accrue interest, so the sooner you repay, the more money you save. As with OnDeck’s term loans, it reserves the lowest interest rates on lines of credit for the most creditworthy borrowers that have an excellent cash flow and a strong payment history on prior financing products from OnDeck.

Aside from interest, OnDeck has a $20 monthly maintenance fee but no origination or draw fees. Additionally, if you withdraw at least $5,000 within the first five days of opening an account, the company will waive your maintenance fee for the first six months.

OnDeck’s lines of credit carry the option of Instant Funding for transactions between $1K-$10K. This allows qualified businesses to withdraw funds from their LOC instantly at any time, with no added fee.

OnDeck

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Application Process

Rating: Excellent

OnDeck has a fast and straightforward application process.

To start the process, all you have to do is fill out an application on the website. According to its FAQ, this is the information OnDeck might ask for:

Business tax ID
Bank statements for the previous few months
Social Security number of the business owner(s)
Driver’s license number and state of issue

OnDeck will also ask for a bit of personal information about yourself, your business, and why you want the loan. While applying for a loan, you can call, email, or live chat with a loan specialist to help you through the process or answer questions.

When you’re done with the application, OnDeck will let you know if you’ve been approved or not. If you have, somebody from the company will get in touch with you to go over the details, make sure you understand the loan, and gather any additional information they might need.

All this usually takes less than 24 hours. Should you choose to accept the loan, it will be wired into your bank account within a day or two — possibly even the same business day.

Sales & Advertising Transparency

Rating: Good

Over the years, OnDeck has gotten a lot of flack for its sales and advertising transparency.

This lender famously did not sign the Small Business Borrowers’ Bill of Rights, a bill created as an attempt for companies in the industry to self-regulate. The bill includes standards, such as sales and advertising transparency and the right to non-abusive products. Lenders such as OnDeck claim the Bill of Rights does not represent the kind of products that they offer.

However, it should be noted that OnDeck has formed its own association with a few other lenders called the Innovative Lending Platform Association (ILPA) as a sort of response to the aforementioned Bill of Rights.

As it currently stands, OnDeck’s website transparency is fair. Although it does not disclose the full range rates or APRs, you should have a good idea of how OnDeck’s loans work, what fees to expect, and what borrowers are eligible for the service.

Also, you’ll know everything you need to before accepting the loan — the ILPA has recently introduced SMART Box, a tool intended to help borrowers easily compare loan options. It includes some useful information, such as the APR and the cents-on-the-dollar cost for potential loans. While its website could provide a bit more information, you will know everything you need to know before signing the contract.

Customer Service & Technical Support

Rating: Excellent

Customer service is available by phone, email, or live chat. You can also get in contact via OnDeck’s Facebook or Twitter or find the answers to basic questions in the FAQ located on its website.

The general consensus is that OnDeck has quality, proactive customer service. Merchants are paired with a single account representative for the life of the loan; these representatives are available to walk you through the process, answer questions, and make the whole process more personable. Customers appear happy with the level of helpfulness and knowledge of the customer service reps, and they seem to like the personal bond they form with them.

OnDeck Reviews, Complaints, & Testimonials

Though there are some scattered complaints, the majority of OnDeck business loans reviews are overwhelmingly positive.

Rating: Excellent

Negative Reviews & Complaints

OnDeck is accredited with the Better Business Bureau, with an A+ rating. In the last three years, it’s accrued a total of 33 complaints and 143 customer reviews, rating an average of 3.86/5 stars. Given the size of the company, this number of complaints is not especially large.

Taking a closer look at OnDeck Capital complaints, some common criticisms leveled against OnDeck in negative reviews include the high cost of borrowing, lack of transparency about loan terms, daily repayments, application delays, and insufficient COVID assistance.

High Cost Of Borrowing: With effective APRs that could reach up to 98.3%, this lender’s loans can be far from cheap. For comparison’s sake, lenders that offer more traditional term loans usually carry APRs that cap off at 40% or less. While paying more for working capital is not the end of the world, I’d advise you to make some comparisons before accepting a loan if you have the time.
Advertising Transparency: Some customers have felt that they didn’t fully understand the true cost of the loan before accepting the offer.
Application Delays: While OnDeck can instantly make a lending decision for a majority of applicants, it does have to ask some applicants to submit more information. However, these delays are common in the lending industry and will not add a significant amount of time to the application in most cases.

Positive Reviews & Testimonials

OnDeck has quite a few video testimonials on its website, along with a plethora of positive reviews on its Facebook, Trustpilot, and Google pages. OnDeck rates 4.9/5 stars on Trustpilot, with overwhelmingly positive reviews. While OnDeck loans undeniably carry some problems, it’s clear that a lot of merchants are pleased with the service. Here’s what they liked:

The fast, easy application process
The fast time to funding
The friendly, knowledgeable customer service
OnDeck reports to business credit bureaus (which helps you build business credit)

We’d like to hear from customers in a more neutral setting, though. Have you dealt with OnDeck? What did you think of the experience? Leave a message in the comments!

Final Verdict

Enova, OnDeck’s owner since Oct. 2020, seems to have made some adjustments to the OnDeck formula. For the most part, very little has changed, but the average cost of borrowing has gone up a bit. It’s also now more difficult to qualify for OnDeck loans, which require two or more years in business and yearly revenue of $250,000 or more.

On the other hand, term loans are now available in up to two-year terms.

If you own a well-established business that’s been held back by less-than-perfect credit, OnDeck could be the solution for you. While some business owners might be able to find better rates elsewhere, OnDeck is clearly interested in educating the merchants and providing a pleasant user experience throughout the process.

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Chris Motola

Expert Analyst & Reviewer at Merchant Maverick

An expert in personal and business loans and financial health, Chris Motola has been writing about small business finance and payments for over 5 years. He has been cited in various industry publications, including Forbes Advisor, GoBankingRates, and Medium. Chris is a graduate of the University of Central Florida.

View Chris Motola's professional experience on LinkedIn.

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The Merchant Maverick Seal of Approval 🏆

OnDeck	Apply Now

After hours of in-depth research and evaluation, we can confidently recommend this brand to our readers. Get started today and see OnDeck for yourself.

The Merchant Maverick Seal of Approval 🏆

OnDeck	Apply Now

After hours of in-depth research and evaluation, we can confidently recommend this brand to our readers. Get started today and see OnDeck for yourself.