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The 5 Best Banks For Small Business Loans In 2022

Wondering which banks are best for small business loans? These five institutions offer small business bank loans at reasonable rates.

    Jason Vissers
  • UPDATED

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

If you’re considering getting a loan to fund your small business, the first source that may come to mind is a bank. Banks have deep pockets, offer in-house checking and savings accounts, and usually offer better rates than alternative lenders. The best banks for small business loans may be more accessible than you think.

Because you’re likely to face strict credit requirements and geographic constraints, you might consider seeking a loan from the bank you currently use, since they already know you and your financial profile. However, the economy of scale offered by big national banks can possibly get you a better deal, provided you meet their stringent qualifications.

Unfortunately, if your credit score is under 600 or your business hasn’t been around long, you may not qualify for a bank loan. But if you have a solid credit score and steady revenue, you can take advantage of low rates, long repayment terms, and a variety of financial products. Keep reading to see our picks for the best banks for small business loans. 

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The 5 Best Banks For Small Business Loans

When looking at the “best” banks for small business loans, we’re considering a combination of excellent rates and accessibility. One thing to note is you may very well be able to get a better deal from your local community bank or credit union. However, because the banks below are institutions that cover large portions of the country, there’s a high probability that at least one of them will be operating in your market or in your nearest major city.

1. Wells Fargo: Easiest Bank For Business Loans

Wells Fargo Business Loans


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Pros

  • Multiple types of financing
  • Low rates
  • Easy online application process
  • Multiple branches nationwide

Cons

  • Strict credit requirements
  • Funds can take weeks to be disbursed

Wells Fargo Features

Wells Fargo offers a number of financial products for small business owners. And with over 8,000 branches nationwide, it won’t be too difficult to find a location near you. Through Wells Fargo, you can apply for the following:

  • Lines of credit up to $500,000
  • Small Business Association 7(a) loans up to $5 million
  • Commercial real estate loans, including the SBA 504 loan.

Wells Fargo Interest Rates & Fees

  • Lines of credit: Rates range from prime + 1.75% to prime + 9.75%
  • SBA 7(a) loans: Interest rates not disclosed
  • Commercial real estate loans: Interest rates not disclosed

Eligibility Requirements

Wells Fargo’s lines of credit require 2+ years in business with established business credit.

Repayment Terms

  • SBA 7(a) loans: 25 years for commercial real estate, up to 10 years for all other purposes
  • SBA 504 loans: 25 years for commercial real estate, up to 10 years for machinery or equipment
  • No other repayment terms are disclosed

Where Wells Fargo Really Shines

Not only does Wells Fargo have numerous financial products and locations, but it also offers an easy application process. While the process varies based on your chosen product, you can apply easily online for many of the bank’s loans and lines of credit without even leaving your home or office.

Get Started With Wells Fargo Business Loans

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2. Chase Bank: Best Bank For Startups

Chase Bank Business Loans


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Pros

  • Low-interest rates
  • Few extra fees
  • Multiple types of financing
  • Loans for startups & established businesses

Cons

  • Not available in all states
  • Strict credit requirements
  • Slow application process

Chase Bank Features

Chase has financing options for credit-worthy established businesses and startups. These include:

  • Lines of credit of up to $500,000
  • Long-term loans
  • Commercial real estate loans
  • SBA loans (7(a) loans, 504 loans, and Express loans)

Chase Bank Interest Rates & Fees

Chase Bank does not disclose interest rates for its loan products.

Eligibility Requirements

Chase Bank does not disclose eligibility requirements for its loan products.

Repayment Terms

  • Term loans: 12 to 84 months
  • Lines of credit: Renewable 5-year revolving term

Where Chase Bank Really Shines

What sets Chase apart from other banks is its low rates — purported to be some of the lowest in the industry — and its wide selection of financial products for small business owners. While Chase is one of the largest banks in the nation, its loan application process is pretty traditional — you have to visit your local branch to apply for a small business loan. However, with over 5,000 branches nationwide, most business owners should be able to find a local branch to kickstart the loan application process.

Get Started With Chase Bank Business Loans

Read our in-depth review

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3. U.S. Bank: Overall Best Bank For Small Business Loans

U.S. Bank Business Loans


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Pros

  • Multiple types of financing
  • Low-interest rates
  • Few extra fees
  • Good customer service & support

Cons

  • Strict credit requirements
  • Not available in all states

U.S. Bank Features

U.S. Bank stands out above its competitors as a small business-friendly bank. U.S. Bank offers numerous financial products suitable for businesses of all sizes, including:

  • Quick fixed-rate loans up to $250,000
  • Term loans up to $1 million
  • Commercial real estate loans up to $10 million
  • SBA 7(a) and 504 loans

U.S. Bank Interest Rates & Fees

  • Quick loans: Rates “as low as 5.99%” for secured loans
  • No other rates disclosed

Eligibility Requirements

U.S. Bank does not disclose eligibility requirements for its loan products.

Repayment Terms

  • Quick loans: Terms up to 84 months
  • Commercial real estate loans: Terms of 5, 10, and 15 years & amortization up to 25 years
  • No other repayment terms disclosed

Where U.S. Bank Really Shines

Borrowers will find that U.S. Bank offers competitive interest rates and very few extra fees. Additionally, U.S. Bank offers good customer support and has an overall positive reputation among its customers.

As with other bank loans, qualifying is reserved for the most credit-worthy borrowers. Additionally, U.S. Bank doesn’t have quite as large a reach as others on this list, serving 25 just states. If you’re on the East Coast, you’ll need to find another lending option. However, if you’re in one of U.S. Bank’s service areas, consider giving them a try.

Get Started With U.S. Bank Business Loans

Read our in-depth review

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4. Bank Of America: Best Bank For SBA Loans

Bank Of America Business Loans


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Pros

  • Multiple types of financing
  • Low-interest rates
  • Good customer service & support

Cons

  • Not available in all states
  • Strict credit requirements
  • Slow application process

Bank Of America Features

Bank of America is an SBA Preferred Lender and offers a number of low-interest SBA loans to its customers, along with other loan types. All told, BofA offers the following:

  • Term loans
  • Lines of credit
  • Commercial auto loans
  • Equipment loans
  • Commercial real estate loans
  • SBA 7(a) loans
  • SBA 504 loans

Bank Of America Interest Rates & Fees

  • Lines of credit: Rates “as low as 5.25%” (4.50% for secured lines of credit)
  • Term loans: Rates “as low as 5.75%”, $150 origination fee if approved
  • Commercial real estate loans: Rates “as low as 4.75%”

Eligibility Requirements

  • Lines of credit & term loans: 2 years in business under current ownership & $100k+ in annual revenue
  • Commercial real estate loans: 2 years in business under current ownership & $250k+ in annual revenue

Repayment Terms

  • Term loans: 12 to 60 months
  • Commercial real estate loans: Up to 10 years (with balloon payment), up to 15 years (with full amortization)

Where Bank Of America Really Shines

Bank Of America frequently tops the SBA’s most active lenders list and has loaned billions of dollars to eligible small business owners struggling through the coronavirus pandemic through the SBA’s Paycheck Protection Program. There are over 4,000 branch locations nationwide, making it easy and convenient to apply for funding.

Get Started With Bank Of America Business Loans

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5. TD Bank: Best Big 4 Alternative

TD Bank Business Loans


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Pros

  • Excellent customer service
  • No origination fees on loans under $100K
  • Competitive interest rates

Cons

  • Not available in all states
  • Strict credit requirements

TD Bank Features

If you’re looking for an alternative to the Big 4 banks, look no further than TD Bank. TD Bank offers business financing as follows:

  • Business term loans up to $1 million
  • Lines of credit up to $500,000
  • SBA 7(a) and 504 loans

TD Bank Interest Rates & Fees

TD Bank doesn’t disclose interest rate ranges but does state that there are no origination fees for business loans under $100,000.

Eligibility Requirements

TD Bank doesn’t disclose eligibility requirements on its site.

Repayment Terms

  • Business term loans: 3 to 5 years amortization
  • No other repayment terms disclosed

Where TD Bank Really Shines

While smaller than the other banks on this list, TD Bank nonetheless provides loan options with competitive interest rates for businesses of all sizes. TD Bank operates in 16 states, primarily states located on the East Coast. In addition to its wide breadth of financial products, TD Bank sports excellent customer service.

Get Started With TD Bank Business Loans

Read our in-depth review

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Which Bank Loan Is Right For Your Small Business?

When looking for the best banks for small business loans, know that although you can turn to any bank operating in your area, they can be tough nuts to crack, especially for businesses with less-than-perfect credit, or those that haven’t been in business very long. If you need a loan quickly, you might consider our picks for the best same-day funding options. Businesses that can meet their qualifications and can wait out the slower application processes, on the other hand, should consider small business bank loans.

Types Of Business Loans Offered By Banks

As traditional lending institutions, banks usually offer a full spectrum of financial prospects to their customers. None of these are inherently “better” than any other, but they each come with their own sets of qualifications and terms that may make one product the superior choice for a specific business.

Term Loans

Term loans provide the borrower with a lump sum of money. You’ll then pay the amount you borrowed, called a principal, back over a timeframe called a term, plus interest. Banks usually deal in long and medium-term loans with terms longer than one year. Banks are less likely to deal with short-term loans. As we explain in our guide to short-term loans, these loans work a bit differently.

Most banks offer both types, so make sure you know the difference between secured vs unsecured loans. Secured loans are backed by collateral, typically an asset or a cash deposit. As a result, they usually have lower rates and higher borrowing limits than comparable unsecured loans.

Lines Of Credit

Where term loans grant you a lump sum, lines of credit instead give you the ability to borrow money up to your credit limit for a specified amount of time. Most are revolving lines of credit, meaning that you can reuse credit after you have paid it off.

Whereas term loans are used for working capital, expansions, and equipment, lines of credit are more often used for miscellaneous expenses or to smooth out a company’s cash flow. They can also provide a bit of security for unexpected expenses. Like term loans, lines of credit may be secured or unsecured.

Equipment Financing

Equipment loans are a type of secured term loan that is specifically for buying equipment for your company. They follow, more or less, the same rules as term loans, but the asset that you’re purchasing is used as security for the loan.

SBA Loans

Many banks offer SBA loans. As we detail in our SBA loans explainer, these come in a variety of different forms, the most common being the SBA 7(a) loan and the SBA 504 loan. The SBA doesn’t originate loans, but it does provide a guarantee on loans offered through other institutions (such as banks), allowing businesses that wouldn’t otherwise qualify for financing to access capital at competitive rates and terms. Just be prepared for a longer application process.

How To Qualify For A Small Business Bank Loan

So you like what you see and want to work with a bank? Well, there’s a reason the alternative lending market exists, and it’s because getting a bank loan can be surprisingly challenging these days. If you want to maximize your chances of being approved, here are some things you can do.

Watch & Repair Your Credit

Traditional lenders care about traditional markers of trustworthiness, and that, unfortunately, means you’re going to need good credit. If your credit isn’t in the high 600s or better, most banks will be hesitant to take a risk on you.

Check your credit score via a free credit score site. And if your credit needs work, learn how to improve your personal credit score. You might also want to check out our 10 favorite business loans for startups with bad credit.

Have A Business Account With The Bank

If you don’t look like a fantastic borrower on paper, you can still build a relationship with your prospective bank by being a customer. Not only can this give you room to negotiate, but it will also make it easier to apply when you’re ready. Additionally, some banks will only lend to customers who have accounts with them, regardless of how good your credit is.

Watch Your Cash Flow

It should be obvious, but banks don’t want to lend to customers who are financially unable to pay back their loans. Formulae vary from bank to bank — for example, Wells Fargo likes to see $1.50 in revenue for every $1 you borrow — but you’ll want to make sure you have some margin for error for making your payments. Learn how to calculate your debt service coverage ratio (DSCR), so you can assess whether you’re a good candidate for a bank loan.

Have A Good Track Record As A Business Owner

Most banks will want to see that you’ve been able to keep a business afloat for a while. That means having been in business for two to three years, minimum. If you need help before that, you may want to look at alternative business lenders.

Have Documentation Ready

If you’re applying to the bank where you also have business accounts, you’ll save some labor here. However, you’ll still need to be ready to produce a host of documents (doubly so if you’re applying for an SBA loan). These are things such as tax returns, proof of business registration, personal identification, financial statements, collateral (if applicable), information on any other loans you might have, and your business plan. We recommend that you learn how to write a good one-page business plan before you apply for a loan.

Alternatives To Small Business Bank Loans: Online Lenders & Nonprofits

Have banks rejected you? Did you read the above section and are now worried you probably won’t qualify for a small business bank loan? Do you need money faster than most banks can deliver it? Are you just starting and need a cash infusion?

You’re not alone. In fact, there’s a large market for people like you.

How Online Lenders & Nonprofits Are Different From Banks

Since the Great Recession tightened lending standards a decade ago, an alternative online market has grown that’s focused on getting money to businesses with poorer qualifications. Banks themselves, or investors with an appetite for risk, usually finance these companies. They also tend to have much easier and quicker applications, making them appealing to businesses that need money immediately.

Of course, this comes with a trade-off. While the seedier alternative lenders tend to fail over time, you still want to enter the alternative market with caution. Even honest and transparent lenders will (probably) have higher rates than a bank would offer you. Your credit score will be less of a factor here, but still, the better your credit score is, the better the rates you can expect.

The other option is to look at programs offered by nonprofits. Of particular interest will be the loans provided by Community Development Financial Institutions (CDFIs). These may be banks, credit unions, loan funds, or even venture capitalists certified by the CDFI Fund. CDFIs are often open to new businesses — even most online lenders shy away from businesses that haven’t been around for at least six months — and usually have good interest rates, though not as good as those of banks. Just be prepared for a lengthy application process as you try to match your needs with those of existing programs.

Where To Find Online Lenders & Nonprofits

Online lenders are incredibly easy to find. In fact, it’s almost impossible not to stumble across them if you do business at all online. Finding the ones you want to work with, however, will probably take a little bit of research. Merchant Maverick can give you a head start with that; check out our choices for the best small business loans. And for even more options, see our complete list of startup business loan reviews.

Nonprofits are a different ballgame. Most operate on a local rather than national level, so you may have to do some research to find the ones in your area. The easiest way to do this is to use the CDFI locator on the Opportunity Finance Network or CDFI Fund websites.

Small Business Bank Loan FAQs

How do I get a business loan from a bank?

To get a business loan from a bank, it’s important to first understand the requirements of the bank and determine whether you meet those requirements. If requirements are met, you will need to follow the bank’s application process, which may be completed online or may require you to visit your local branch.

Which bank gives the lowest interest rate for small business loans?

The lowest interest rates for small business loans vary by financial product. While the top banks in the nation offer competitive rates, it’s possible you may find lower rates at your local small bank or credit union, so make sure to shop around.

Which banks offer business loans?

Most banks and credit unions offer business loans, although the types of products offered may vary. Make sure to compare your options to find the best products, rates, and terms for your business.

What is the best place to get a small business loan?

The best place to get a small business loan is a bank or financial institution that offers multiple products, low rates and fees, long terms, easy application processes, and good customer service and support. Start your search with your own bank, and make sure to compare your options to find the best fit.

Which bank gives the cheapest business loan?

When seeking a loan from a bank, the cost will vary depending on the type of loan product you apply for and the risk profile of your business (and yourself). That’s why it’s impossible to say which bank offers the “cheapest” business loan, though you should definitely shop around to find the best rate.

What is the easiest SBA loan to get?

The various SBA loan programs all have their own intended beneficiaries and eligibility requirements, so the SBA loan that is “easiest” to get will depend on the nature of your business, your geographic location, and other factors.

In Summary: The 5 Best Banks For Business Loans

The banks listed in this article are, according to what we’ve found, the best banks for small business loans. Of course, banks also offer business bank accounts, which can be crucial to managing your business finances. We suggest checking out our list of the top 12 business banking account providers. For even more providers, see our full directory of business bank account reviews.

Have you taken out a business loan from any of the banks we’ve listed, or from any other bank? If so, please let us know about your experience in the comments!

In Summary: The 5 Best Banks For Small Business Loans

  1. Wells Fargo Business Loans: Easiest bank for business loans.
  2. Chase Bank Business Loans: Best bank for startups.
  3. U.S. Bank Business Loans: Overall best bank for small business loans.
  4. Bank Of America Business Loans: Best bank for SBA loans.
  5. TD Bank Business Loans: Best Big 4 alternative.
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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