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Comparing Online Business Loan Providers

Comparing Online Business Loan Providers

What to Consider When Choosing an Online Lender

When researching online lenders, there are several key factors to take into account:

  • Loan amounts – Online lenders typically offer loans ranging from $5,000 up to $500,000. Consider how much capital your business needs.
  • Interest rates and fees – Interest rates can vary dramatically between lenders, from around 5% to well over 30%. Also factor in any origination fees or closing costs.
  • Repayment terms – Repayment periods range from 3 months to 5 years. Make sure the term aligns with your cash flow.
  • Funding speed – Some lenders can fund loans in as little as 24 hours, while others may take weeks. Think about your urgency.
  • Eligibility – Each lender has its own requirements regarding time in business, revenue, and credit score. Understand if you qualify.
  • Customer service – Getting support when you have questions is vital. Research reviews and test out communication.

Top Online Small Business Loan Companies

Here is an overview of some of the most popular online small business lenders to consider:

Kabbage

Kabbage has provided over $10 billion in funding to small businesses. They offer lines of credit up to $250,000 with competitive variable rates from 1.5% to 8%. Funding can be very fast – sometimes in just a few minutes after approval. Kabbage also has a business checking account to help manage finances. The convenience and technology make this a top choice.

“Kabbage was great when I needed a quick influx of cash after some unexpected expenses. The whole process took less than a day.”

OnDeck

OnDeck focuses specifically on online small business loans and lines of credit ranging from $5,000 up to $500,000. OnDeck uses an innovative lending platform to provide customized offers with fixed daily or weekly payments. While interest rates are higher than some lenders (capped at 80% APR), many appreciate the predictability of regular installment payments.

“After being denied from my bank for an expansion loan, OnDeck came through quickly with better rates. The fixed daily payments help me budget.”

Fundbox

Fundbox allows businesses to draw from a revolving credit line up to $100,000. One unique advantage is that you only pay interest on the amount you currently have drawn. Their rates are very competitive at around 1% per week. Fundbox can advance payments for outstanding invoices you send to customers to improve cash flow as well.

“Fundbox has worked as an extremely convenient source of working capital for my small agency. I can access funds and only pay for what I use.”

PayPal Working Capital

A good option for businesses with regular PayPal revenue is PayPal Working Capital. You can borrow between $5,000 and $125,000 based on a percentage of your PayPal sales over 12 months with flexible repayment deducted from your PayPal account as you make sales. There are no fixed monthly payments or due dates. Rates range from 1.5% to 2.9% per week.

“As an ecommerce company using PayPal for most transactions, getting capital from PayPal Working Capital was an easy decision. The automatic repayments make it very convenient.”

BlueVine

BlueVine provides both financing and banking services created specifically for small businesses. They offer lines of credit up to $250,000 with rates as low as 4.8% and terms up to 12 months. BlueVine also provides invoice factoring, allowing you to get paid early on outstanding invoices. Many users praise their easy online interface.

“I didn’t think I would qualify for financing as a newer business, but BlueVine worked with me to set up a line of credit that met my needs with reasonable rates.”

Key Questions to Ask Online Lenders

Before applying for a loan, make sure to ask lenders these important questions:

  • What are your rates and how are they calculated? Are there any origination fees or closing costs?
  • How quickly can I access capital once approved?
  • What are the repayment terms and schedules?
  • What happens if I miss or need to reschedule a payment?
  • Who do I contact for support after receiving the loan?
  • What documents and financial information will I need to provide?

Getting clear answers upfront will ensure you understand what to expect as a borrower.

The Bottom Line

Online lenders can provide fast, convenient access to funding that traditional banks may not. When choosing the right option, take into account your specific financing needs, eligibility, rates and terms. Weigh the pros and cons of offerings from top providers like Kabbage, OnDeck, Fundbox, PayPal Working Capital and BlueVine. Ask lots of questions before committing to find the best loan for empowering your business growth.

With some diligent research, you can find an online lending partner to provide the small business loan your company needs to take the next step forward.

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