Unsecured business loans

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Top unsecured business loans.

By: Tanner Cupello

Last updated: 8/8/2024

An unsecured business loan is a financing option that does not necessitate collateral, allowing you to secure funding without risking personal assets. Lenders may still require a personal guarantee or file a blanket lien on business assets. Here’s a quick comparison of some of the best unsecured business loans available:

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Lendio’s recommendations and reviews are selected by our team of lending experts who have worked directly with each funder in our network. While the lenders featured are all partners we work with, reviews are based on our team’s experience and a methodology with multiple criteria.

*Lender/FunderTypeFinancing AmountMinimum Time in BusinessTermMinimum Credit ScoreTime to Funds
Headway CapitalLine of Credit$5K-$100,0001 year12, 18, or 24 months625As fast as 24 hours
Idea FinancialLine of Credit$10,000-$275,0002 yearsUp to 18 months650As fast as 24 hours
Gillman-BagleyInvoice Factoring$50,000 to $10 million3 months30 daysNone1 business day
OnDeckBusiness Cash Advance$5,000-$250,0001 year18-24 months625Same day after approval
Funding CircleTerm Loan$25,000-$500,0002 years6 months to 7 years6603 days after approval
BHG FinancialTerm Loan$20,000-$500,0002 years3-12 years7003 days after approval

Detailed overview of top lenders.

Headway Capital – Line of Credit

Interest rate

Starting at 3.3% monthly

Funding amount

$5,000-$100,000

Term

12, 18, 24 months

Minimum credit score

625

Time to funding

As fast as 24 hours after approval

Headway Capital offers a true revolving line of credit. Their monthly payments and ongoing access to capital make it a great product for those who want to be able to access funds at any time. With their fast and easy application and funding process you can have funds in your account within one
business day.

Pros:

  • Best line of credit for less-qualified borrowers
  • Weekly or monthly repayment options available
  • Just 1-year minimum time in business required

Cons: 

  • Not available to businesses in Arkansas, Connecticut, Michigan, Montana, North Dakota, Nevada, Rhode Island, South Dakota, and Vermont
  • Lower max loan amount
  • Draw fees may apply
  • Terms and fees vary depending on what state you operate out of
  • Minimum first draw amount
  • 2% draw fee in most states

 

 

Headway Capital Logo

Headway Capital – Line of Credit

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Interest rate

Starting at 3.3% monthly

Funding amount

$5,000-$100,000

Term

12, 18, 24 months

Minimum credit score

625

Time to funding

As fast as 24 hours after approval

Headway Capital offers a true revolving line of credit. Their monthly payments and ongoing access to capital make it a great product for those who want to be able to access funds at any time. With their fast and easy application and funding process you can have funds in your account within one
business day.

Pros:

  • Best line of credit for less-qualified borrowers
  • Weekly or monthly repayment options available
  • Just 1-year minimum time in business required

Cons: 

  • Not available to businesses in Arkansas, Connecticut, Michigan, Montana, North Dakota, Nevada, Rhode Island, South Dakota, and Vermont
  • Lower max loan amount
  • Draw fees may apply

  • Terms and fees vary depending on what state you operate out of
  • Minimum first draw amount
  • 2% draw fee in most states

 

 

Idea Financial – Line of Credit

APR range

Daily interest rate minimum of 0.0658%

Funding amount

$10,000-$275,000

Term

Up to 18 months

Minimum credit score

650

Time to funding

As fast as 24 hours after approval

Idea Financial provides a line of credit to business owners who have been in business for at least two years and have a monthly revenue of $15,000 or more. They do not lend to sole proprietors or non-profits.

Pros:

  • Best line of credit for length of term offered
  • Quick approval and funding 

Cons: 

  • Selective qualification requirements
  • Doesn’t lend to sole proprietors or nonprofits
  • 1.99%-2.99% draw fee
  • No origination fee

 

 

Idea Financial Logo

Idea Financial – Line of Credit

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APR range

Daily interest rate minimum of 0.0658%

Funding amount

$10,000-$275,000

Term

Up to 18 months

Minimum credit score

650

Time to funding

As fast as 24 hours after approval

Idea Financial provides a line of credit to business owners who have been in business for at least two years and have a monthly revenue of $15,000 or more. They do not lend to sole proprietors or non-profits.

Pros:

  • Best line of credit for length of term offered
  • Quick approval and funding 

Cons: 

  • Selective qualification requirements
  • Doesn’t lend to sole proprietors or nonprofits

  • 1.99%-2.99% draw fee
  • No origination fee

 

 

Gillman-Bagley – Invoice Factoring

Factor Rate

Varies

Funding amount

$50,000 to $10 million

Term

30 days

Minimum credit score

None, based on your accounts receivable

Time to funding

As soon as same day

Gillman-Bagley offers invoice factoring up to $10 million. They specialize in working with government contractors, manufacturing and other B2B companies. 

Pros:

  • Best for customer experience
  • Builds business credit
  • No minimum credit score
  • No minimum amount of time in business

Cons: 

  • Minimum funding amount of $50,000
  • Doesn’t work with medical offices or construction
  • No facility or processing fees
Gillman Bagley

Gillman-Bagley – Invoice Factoring

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Factor Rate

Varies

Funding amount

$50,000 to $10 million

Term

30 days

Minimum credit score

None, based on your accounts receivable

Time to funding

As soon as same day

Gillman-Bagley offers invoice factoring up to $10 million. They specialize in working with government contractors, manufacturing and other B2B companies. 

Pros:

  • Best for customer experience
  • Builds business credit
  • No minimum credit score
  • No minimum amount of time in business

Cons: 

  • Minimum funding amount of $50,000
  • Doesn’t work with medical offices or construction

  • No facility or processing fees

OnDeck – Business cash advance

Funding amount

$5,000-$250,000

Term

18-24 months

Minimum credit score

625

Time to funding

As fast as same day after approval

OnDeck offers a business cash advance of up to $250,000. Unlike other cash advance providers, OnDeck charges an interest rate instead of a factor rate and is a publicly traded company. OnDeck also offers a line of credit of up to $100,000.

Pros:

  • Best online closing experience
  • Fast funding
  • Can help boost your credit because they report to the major credit bureaus 
  • No prepayment fees

Cons: 

  • Potentially high interest rates compared to other types of financing
  • Daily or weekly payments
  • 0% to 4% origination fee

OnDeck – Business cash advance

Read our review Apply with Lendio

Funding amount

$5,000-$250,000

Term

18-24 months

Minimum credit score

625

Time to funding

As fast as same day after approval

OnDeck offers a business cash advance of up to $250,000. Unlike other cash advance providers, OnDeck charges an interest rate instead of a factor rate and is a publicly traded company. OnDeck also offers a line of credit of up to $100,000.

Pros:

  • Best online closing experience
  • Fast funding
  • Can help boost your credit because they report to the major credit bureaus 
  • No prepayment fees

Cons: 

  • Potentially high interest rates compared to other types of financing
  • Daily or weekly payments

  • 0% to 4% origination fee

Funding Circle – Term loan

APR range

15.22% to 45%

Funding amount

$25,000 to $500,000

Term

6 months to 7 years

Minimum credit score

660

Time to funding

As fast as 3 days after approval

For a term loan, consider applying with Funding Circle. The lender offers large loan amounts up to $500,000. However, their required 660 minimum credit score makes it more difficult to qualify for than some other online lenders.

Pros:

  • Best alternative option to SBA
  • Fixed monthly payments
  • No early repayment fees that lets you save on interest
  • Large loan amounts available

Cons: 

  • Longer time in business requirement than with other loan products
  • Longer possible time to receive funds than other lenders might take
  • 4.49% to 8.49% origination fee 
  • Late payment fee 5% of missed payment

Funding Circle – Term loan

Read our review Apply with Lendio

APR range

15.22% to 45%

Funding amount

$25,000 to $500,000

Term

6 months to 7 years

Minimum credit score

660

Time to funding

As fast as 3 days after approval

For a term loan, consider applying with Funding Circle. The lender offers large loan amounts up to $500,000. However, their required 660 minimum credit score makes it more difficult to qualify for than some other online lenders.

Pros:

  • Best alternative option to SBA
  • Fixed monthly payments
  • No early repayment fees that lets you save on interest
  • Large loan amounts available

Cons: 

  • Longer time in business requirement than with other loan products
  • Longer possible time to receive funds than other lenders might take

  • 4.49% to 8.49% origination fee 
  • Late payment fee 5% of missed payment

BHG Financial – Term loan

APR range

Rates starting at 12.49%

Funding amount

$20k – $500K

Term

3-12 years

Minimum credit score

700

Time to funding

Approval in as little as 24 hours, funding in as little as 3 days

BHG Financial specializes in providing tailored financial solutions to professionals across various industries with a focus on healthcare practitioners. If you’re looking for a much longer-term loan, BHG Financial can offer businesses loans with up to 12-year terms. Licensed professionals can get a loan to start their practice if they have a personal annual income of $100K+.

Pros:

  • Best term loan for healthcare industries
  • Strong customer service
  • Transparent fees
  • Variety of loan options

Cons: 

  • Restricted industries include gas stations, transportation, restaurants, and most construction.
  • Longer time in business requirement than with other loan products

3% origination fee

BHG Financial – Term loan

Read our review Apply with Lendio

APR range

Rates starting at 12.49%

Funding amount

$20k – $500K

Term

3-12 years

Minimum credit score

700

Time to funding

Approval in as little as 24 hours, funding in as little as 3 days

BHG Financial specializes in providing tailored financial solutions to professionals across various industries with a focus on healthcare practitioners. If you’re looking for a much longer-term loan, BHG Financial can offer businesses loans with up to 12-year terms. Licensed professionals can get a loan to start their practice if they have a personal annual income of $100K+.

Pros:

  • Best term loan for healthcare industries
  • Strong customer service
  • Transparent fees
  • Variety of loan options

Cons: 

  • Restricted industries include gas stations, transportation, restaurants, and most construction.
  • Longer time in business requirement than with other loan products

3% origination fee

Types of unsecured business loans.

Different types of unsecured business loans cater to various needs:

SBA Microloan

This program offers small unsecured loans of up to $50,000, making it an excellent choice for startups seeking initial funding.

Loan Amount

Up to $50K

Speed of Funds

2-4 Weeks

Best For

Startups

SBA 7(a) Loan under $50K

The SBA doesn’t require collateral for an SBA 7(a) loan under $50K.

Loan Amount

Up to $50K

Speed of Funds

3-4 Weeks

Best For

Small asset purchases

Unsecured line of credit

A flexible funding solution akin to a credit card, allowing businesses to draw on funds as needed without collateral.

Loan Amount

$1K-$250K

Speed of Funds

1-2 Days

Best For

Working Capital

Unsecured term loan

This option provides a fixed amount of capital that is repaid over a predetermined period, ideal for businesses seeking a structured repayment plan.

Loan Amount

$5k-$2M

Speed of Funds

As soon as 24hrs

Best For

Business expansion

Invoice factoring

A method to obtain immediate cash by selling unpaid invoices, offering a quick solution to improve cash flow.

Loan Amount

Up to $10M

Speed of Funds

As soon as 24 hrs

Best for

Account receivable gaps

Business cash advance

This financing option allows businesses to receive an advance on future sales, which is repaid through daily revenue.

Loan Amount

$5K – $2M

Speed of Funds

As soon as 24 hrs

Best for

Short-term needs

How to get an unsecured business loan.

To successfully navigate the funding process, follow these essential steps:

  1. Assess your needs: Identify the amount of funding required and its intended purpose.
  1. Check your credit score: Verify that you meet the minimum criteria set by your selected lender.
  1. Collect necessary documents: Including financial statements, a detailed business plan, and your most recent tax returns.
  1. Apply: Complete the application process and submit the required documents.
  1. Review offers: Compare offers from multiple lenders to determine the best fit for your business needs.
  1. Select lender: Once you’ve found a suitable lender, accept their offer and begin the funding process.
  1. Repay loan: Make regular payments as agreed upon with the lender to ensure good standing and maintain a positive credit score for future financing needs.

Pros and cons of unsecured business loans.

ProsCons
No collateral required: Lower risk to personal or business assets.Higher interest rates: Compensates for the lack of collateral.
Faster approval: Quicker funding compared to secured loans.Stricter credit requirements: May be harder to qualify for some businesses.
Flexible use: Funds can be used for a variety of business needs.Shorter terms: Typically have shorter repayment periods.

Collateral vs. blanket lien vs. personal guarantee

When it comes to securing a loan, there are several options that lenders may require:

  • Collateral: A tangible asset used as security for the loan.
  • Blanket lien: A legal claim on all business assets in case of default.
  • Personal guarantee: The borrower’s personal assets serve as collateral for the loan.

While unsecured loans do not require collateral, lenders may still take out a blanket lien on business assets or require a personal guarantee to mitigate their risk. It is essential to carefully consider these terms and evaluate the potential impact they could have on your business before accepting an unsecured loan offer.

1. Tell us about your business.

Answer a few simple questions and complete the application in minutes.

2. Submit your application.

We’ll put your application in front of 75+ lenders. Applying is free and won’t impact your credit score.

3. Compare offers.

Find the funding option with the terms that best fit your small business goals.

4. Get funded.

Once you accept, funding can hit your bank account in as little as 24 hours.

Lendio’s methodology

Wondering how we chose the best? We used the following criteria to evaluate the lenders in our network.

  • Time to fund
  • Minimum and maximum loan amounts
  • Lenders with fees comparable to other similar lenders
  • Requirements: Credit score, revenue, and time in business requirements
  • Flexible repayment options
  • External website reviews.

*The information contained in this page is Lendio’s opinion based on Lendio’s research, methodology, evaluation, and other factors. The information provided is accurate at the time of the initial publishing of the page (August 14, 2024). While Lendio strives to maintain this information to ensure that it is up to date, this information may be different than what you see in other contexts, including when visiting the financial information, a different service provider, or a specific product’s site. All information provided in this page is presented to you without warranty. When evaluating offers, please review the financial institution’s terms and conditions, relevant policies, contractual agreements and other applicable information. Please note that the ranges provided here are not pre-qualified offers and may be greater or less than the ranges provided based on information contained in your business financing application. Lendio may receive compensation from the financial institutions evaluated on this page in the event that you receive business financing through that financial institution.