Best business lines of credit in May 2024

Written by
TJ Porter
Edited by
Pippin Wilbers
Reviewed by
Kenneth Chavis IV
May 13, 2024
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A business line of credit can provide much-needed capital for a small business owner's short-term expenses. It can help cover seasonal costs, payroll, emergencies, cash flow issues and more.

Take a look at our picks for the best business lines of credit. Our options include secured and unsecured lines of credit with high loan amounts, low interest rates and fast funding. We even have something if you're still in your startup phase or have bad credit. We'll also help you learn more about how lines of credit for businesses work, how they differ from typical loans and whether they’re the right fit for you.

 
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Bankrate 2024 Awards Winner: Best business line of credit

4.7

Bankrate Review
Loan amount
$5k- $5M
Term: 6 - 120 months
Interest rate
7.00- 19.99%
APR
Fastest funding
1 business day

BEST FOR HIGH LOAN LIMITS

4.6

Bankrate Review
Loan amount
$5k- $750K
Term: 6 - 12 months
Interest rate
Starting at 30.00% APR
Fastest funding
1 business day

Best for established businesses

4.4

Bankrate Review
Loan amount
$5k- $250K
Term: 6 - 12 months
Interest rate
Starting at 6.20%
Fastest funding
1 business day

BEST FOR SHORT-TERM LINES OF CREDIT

4.6

Bankrate Review
Loan amount
$6k- $100K
Term: 12 - 12 months
Interest rate
Starting at 29.90% APR
Fastest funding
1 business day

Best for secured line of credit

4.3

Bankrate Review
Loan amount
$2k- $250K
Interest rate
N/A
Fastest funding
Not disclosed

BEST FOR FAST FUNDING

4.5

Bankrate Review
Loan amount
$1k- $150K
Term: 3 - 6 months
Interest rate
Starting at 4.66%
Weekly fee
Fastest funding
1 business day

Best for low interest

4.3

Bankrate Review
Loan amount
Starting at $25k
Term: 6 - 18 months
Interest rate
Starting at 8.25%
Fastest funding
1 business day

Best for unsecured lines of credit

4.2

Bankrate Review
Loan amount
$10k- $150K
Interest rate
Starting at 10.00%
Fastest funding
Not disclosed

Best for customizable and fast funding

4.6

Bankrate Review
Loan amount
$10k- $750K
Term: 6 - 24 months
Interest rate
Starting at 1.00% per month
Fastest funding
1 business day
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Compare the best business lines of credit in May 2024

Compare the best business lines of credit we mentioned above, their features and what they’re best for side by side so that you can determine which option fits the needs of your business.

LENDER BEST FOR MIN. FICO CREDIT SCORE LOAN AMOUNT MIN. TIME IN BUSINESS
Customizable and fast funding 600 $10,000 to $500,000 6 months
Secured line of credit Minimum FICO score of at least 660* at the time of application $2,000 to $250,000 Must have started your business at least a year ago
Established businesses 625 Up to $250,000 24 months
Flexible lines of credit 580 $1,000 to $500,000 6 months
High loan limits 600 $10,000 to $750,000 12 months
Short-term lines of credit 625 $6,000 to $100,000 12 months
Fast funding 600 Up to $150,000 6 months
Low interest 700 $1,000 and up 6 months
Unsecured lines of credit 680 $10,000 to $1 million 24 months

A closer look at our top business lines of credit

The best business lines of credit offer a wide range of credit limits, lenient eligibility requirements, no draw fees and fast funding. Here we take a closer look at the lenders above and what features they offer.

SBG Funding: Best for customizable and fast funding

Overview: SBG Funding is an online lender offering a variety of small business funding, from term loans to more alternative lending, like merchant cash advances and invoice financing. Its variety of loans can help different businesses get the funding they need. And unlike traditional lenders, SBG works to provide flexible financing solutions with less stringent requirements. For example, you can qualify for a business line of credit with one year in business and a fair personal credit score of 650 or higher.

Who it’s for: SBG Funding’s business line of credit works best if you need customizable financing, allowing you to repay within six to 24 months. You also get the option of weekly or monthly payments, giving you breathing room to choose which schedule fits your business budget. If you need fast approvals, most approvals for SBG Funding happen within 12 to 24 hours, and funding is instant once you’re approved.

American Express Business Blueprint™️: Best for secured line of credit

Overview: America Express Business Blueprint™, formerly Kabbage, is a service from American Express offering lines of credit. It offers accessible eligibility requirements to apply, accepting businesses with fair credit and as little as $3,000 in monthly revenue. Its line of credit can cater to businesses needing small loan amounts from $2,000 to $250,000. But instead of interest, it charges a monthly percentage of your loan balance, a fee structure that can quickly add up to more than you’d pay with other lines of credit. 

Who it’s for: America Express Business Blueprint™ works best if you need a secured business line of credit since you’ll need business assets to secure the loan. You will also need to sign a personal guarantee each time you make a draw, which guarantees that you’ll repay the loan with personal assets if needed.  

This line of credit offers flexible repayment terms of six, 12, 18 or 24 months. The fee ranges from 3.00% to 9.00% on six-month terms, 6.00% to 18.00% on 12-month terms, 9.00% to 27.00% on 18-month terms and 12.00% to 18.00% for 24-month terms. Once approved, you’ll make a monthly payment instead of the usual daily or weekly payment schedule. And you won’t get tagged with a prepayment penalty if you pay back the loan early.

* All businesses are unique and are subject to approval and review.

Bluevine: Best for established businesses

Overview: Bluevine is an online business bank that offers business checking and loan products. For its line of credit, your application can be approved in as little as five minutes. You can then use its handy online dashboard to start drawing funds that same day or even instantly if you have a Bluevine checking account. Its credit lines go up to $250,000, similar to other online lenders.

Who it’s for: Bluevine’s business line of credit is best for established businesses. It requires businesses to have a monthly revenue of at least $40,000 for six-month repayment terms. If you need a longer 12-month term, you’ll have to meet the $80,000 monthly revenue requirement. 

Bluevine makes its business line of credit worth the strict requirements. It accepts fair personal credit as low as 625. It also doesn’t charge fees for origination, maintenance or early repayments. Plus, you get to choose weekly or monthly payments, while other lines of credit keep aggressive debt schedules of daily or weekly payments.

Fundible: Best for flexible lines of credit

Overview: Fundible is an online lender that offers business lines of credit up to $500,000. It has lenient approval requirements and may approve businesses traditionally not accepted by major banks. Unlike other lines of credit that have weekly or biweekly payments, Fundible offers monthly payments. A spokesperson also stated that it offers revolving terms from 12 to 120 months, wide-ranging compared to most credit lines’ 18 months or less.

Who it’s for: Fundible is best for flexible lines of credit because it offers long repayment options that you don’t normally find with line of credit lenders. It’s also accessible to new business owners with just six months in business, and it accepts personal credit scores as low as 580. You will need $200,000 in annual revenue to qualify.

Backd: Best for high loan limits

Overview: Backd is a fintech lender specializing in business lines of credit and working capital loans. It keeps its loan requirements relaxed. And unlike many business lenders, its loans don’t require you to secure them with assets or a personal guarantee. 

Who it’s for:  Backd’s business line of credit is best if you need high credit limits, offering up to $750,000. This maximum limit is high compared to most lenders’ $250,000 credit limit. You can apply and get approved in less than 24 hours, and there are no limitations on how often you draw funds. Keep Backd's short repayment periods in mind, though. It offers weekly payments across six or 12 months.

OnDeck: Best for short-term lines of credit

Overview: OnDeck is an online lender offering both term loans and lines of credit. For its line of credit, the credit limit is $100,000. While this is a low credit limit compared it other lenders, its eligibility requirements are more relaxed, only requiring a personal credit score of 625, one year in business and annual revenue of $100,000. Unlike most lines of credit, OnDeck’s business line of credit also gives you the chance to get same-day or instant funding once you’re approved.

Who it’s for: OnDeck is best for short-term lines of credit because it offers terms of 12, 18 or 24 months, considered short-term loans by business lending standards. These term options are more flexible than other business lines of credit that stop at 12 or 18 months. Plus, you won’t pay a draw fee when accessing your line of credit, and you can adjust your repayment terms to weekly or monthly. 

Fundbox: Best for fast funding

Overview: Fundbox is an online business lender that has offered business lines of credit to over 500,000 businesses since it opened its doors. Through its unsecured line of credit, you can get funding up to $150,000, which is a lower limit than most competitors. Though Fundbox charges a weekly fee, you can bypass it by repaying your loan quickly without early prepayment penalties. 

Who it’s for: Fundbox is best for fast funding, boasting fast approvals as short as three minutes from the time you submit your application. You can then access funds through its website or app and receive funding as soon as the next business day. You will need a business bank account when opening the credit line to easily receive the funding.

Bank of America: Best for low interest

Overview: Bank of America is a national bank with nearly 4,000 branches across the U.S. It offers both secured and unsecured lines of credit that you can renew each year. It also offers a cash-secured credit line with lower qualification requirements, with $1,000 as the minimum deposit. All three of its credit lines offer monthly payments, compared to many online lenders that offer daily or weekly payments.

Who it’s for: Bank of America's business lines of credit are best for their low starting interest rates compared to online lenders. Its lines of credit start at 9.50 percent for the secured line and 10.00 percent for its unsecured line. By comparison, the lines of credit for some online lenders can start at a 30.00 percent APR or higher, depending on your financial profile. 

Bank of America also offers more line of credit options than most lenders. And if you need a credit-builder line of credit, you can qualify for Bank of America’s cash-secured line with just six months in business, $50,000 in annual revenue and a starting cash deposit of $1,000.

Wells Fargo: Best for unsecured lines of credit

Overview: Wells Fargo is a well-established bank with about 4,700 branches across the U.S. It has three business lines of credit products, including two unsecured lines and an SBA-backed line. Most lenders offer just one business line of credit option, and it’s rare to find a lender offering SBA-backed lines. Its unsecured lines of credit offer credit limits of $10,000 to $1 million, a wide range compared to the $250,000 maximum offered by most lenders.

Who it’s for: Wells Fargo is best for unsecured lines of credit because it offers two unsecured lines catering to different crowds. Wells Fargo BusinessLine® line of credit offers loan amounts up to $150,000 with low interest rates between 10.25 percent to 18.25 percent. It comes with a Mastercard that you can use to access the line of credit, a feature that you won’t find with most credit lines. You will pay an annual fee, though it’s waived for the first year.

If your business generates income in the millions of dollars, you may qualify for its Prime Line of Credit with credit limits of up to $1 million. Its starting interest rate is a 9.00 percent APR, low compared to online lenders that can start around a 30.00 percent APR. 

What is a business line of credit?

A business line of credit (LOC) is a flexible loan for businesses that works like a credit card. Companies draw money from their credit lines as needed, only paying interest on the portion of money borrowed. For revolving lines of credit, as the borrower repays the amount borrowed, they replenish the funds available. These funds can typically be accessed using a business checking account or mobile app.

How does a business line of credit work?

Business lines of credit are similar to business credit cards. Both allow small businesses to access funds when needs arise instead of the lump sum a business loan would provide. Interest rates on business lines of credit are typically lower than those of a business credit card. 

Lenders set credit limits and interest rates based on factors like how long the current owner has been in place and what the company’s annual revenue is. An LOC typically requires renewal annually.

The repayment process varies from lender to lender. With some LOCs, you can make interest-only payments during your draw period. A repayment period of up to five years follows the draw periods. Other lenders treat each draw like an individual term loan — you have a set period to repay each draw you make, which could be weeks or months long.

Types of business lines of credit

There are two main types of business lines of credit: secured and unsecured. 

Secured lines of credit are typically easier to qualify for and have lower interest rates. But they require collateral that the lender can repossess if you are unable to make your required payments. Often this will be physical property, such as a piece of real estate your business owns or valuable equipment.

Unsecured lines of credit don’t require collateral. That means you can qualify even if you don’t have anything to put up to secure the loan. But they tend to have stricter eligibility and credit requirements and charge higher interest rates or fees.

 

Business lines of credit and business credit cards both let companies draw funds from a pool of credit on an as-needed basis. Both have their advantages and disadvantages depending on the feature you’re comparing, such as:

  • Loan amounts: Lines of credit typically have loan limits of up to $100,000 to $250,000, though some lenders offer higher limits. Credit card companies typically don’t advertise their credit limits, but they may come with lower limits than a line of credit.
  • Interest rates: Business line of credit rates start as low as 8 percent, while business credit cards tend to have higher APRs of 18 percent to 28 percent. 
  • Rewards: Business credit cards often offer rewards for purchases, such as cash back or points redeemable for travel. It’s rare to find rewards programs with business lines of credit.
  • Grace period: If you pay your business credit card in full each month, you’ll receive a grace period of at least 21 days the next time you borrow funds until you need to repay. During this grace period, you won’t be charged interest for the loan, a feature you just won’t find with business lines of credit.

A business line of credit is a revolving type of business loan. A business can withdraw funds whenever the need arises, as long as the credit limit isn’t exceeded. Interest then accumulates on the funds when they are withdrawn. 

In contrast, a small business term loan is a lump sum of money given with a fixed interest rate and paid back through fixed monthly payments. Loan payments start immediately, whether a business uses the money right away or not. 

Borrowing limits are often lower on a line of credit than on a business loan. For example, a line of credit often stops at $250,000, while business loans might offer $500,000 or more in funding based on your business’s creditworthiness. Additionally, business loans are typically limited to predetermined uses, like purchasing new equipment, while lines of credit are more flexible, allowing you to use the money for whatever business expense you choose. 

Pros and cons of business lines of credit

There are reasons to get lines of credit for businesses and situations where you might want to look into other borrowing options.
 

Pros:

  • Improve cash flow: With access to cash, as needed, you can quickly close gaps in cash flow.
  • Accessible: Online lenders often have more lenient requirements and disburse funds quickly.
  • Establishes a relationship with a lender: A line of credit helps you start a relationship with a lender, which can potentially make it easier to secure additional financing in the future.

Cons:

  • Fees: You may pay a maintenance fee as well as annual renewal fees and draw fees.
  • High interest rates: Business lines of credit tend to have higher interest rates than term loans.
  • Short repayment terms: You may have a short repayment term, such as 12 or 18 months.

Who should get a business line of credit?

Business lines of credit offer flexibility and usually have fewer requirements than business loans. Your specific business needs will determine if a business credit line is right for you. A line of credit is a good fit for businesses that meet the loan requirements and:

  • Are looking for extra cash flow or experiencing a short-term cash flow issue
  • Don't have a specific purpose in mind
  • Experience seasonal fluctuations
  • Have increased short-term expenses, like replacing inventory or paying for unexpected costs
  • Have customers who take longer than 30 days to pay
  • Want easy access to extra funds
  • Can repay the loan quickly

Business lines of credit offer flexibility and usually have fewer requirements than business loans, but lenders often restrict the amount that you can borrow. Generally, business lines of credit will have lower limits than traditional business loans. 

Keep in mind that business lines of credit rates may be variable, meaning that your initial rate may rise over the course of your repayment. There are also usually fees that add to the initial cost of obtaining a line.

When you borrow from the credit line, you also want to make sure that you can successfully manage the repayments, as you will have a set repayment term, such as six to 18 months. A great way to do this is to add the loan repayments as a budget line item in your business budget to ensure you can afford them. 

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Bankrate Insight

If the line of credit you’re considering presents the following red flags, consider going with a different option.
 
  • Vague wording around fees and other aspects of the loan agreement
  • An unusually short draw period
  • Prepayment fees preventing you from repaying your balance early
  • Renewal wording is vague, or it will be difficult to renew the line of credit 
  • The amount you can borrow is much smaller than you need, even if you repay the borrowed amount

Alternatives to business lines of credit

If you aren’t sure if a business line of credit is for you, alternative funding options include:
 
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Bankrate insight

If you’re experiencing a long-term cash shortage, you may want to look into zero-debt financing, a type of financing that doesn’t use debt to fund your business. You can also try cutting expenses or increasing business revenue rather than getting a business loan.

Where to get a business line of credit

You can find lines of credit with both traditional and online lenders.

Traditional banks or credit unions: At these lenders, you can talk to an employee face to face and get all your questions answered. But these lenders have more strict requirements like a long time in business, higher annual revenue or credit score. These may offer more traditional secured loan types, which can lead to potentially lower rates. 

Online banks/financial services companies: These are online lenders that work entirely digitally. You often manage your loan through apps or online portals. They can offer more convenience and have more relaxed requirements. They just don’t offer the face-to-face experience some people prefer.  

To choose the lender that’s right for you, ask how your business measures up against its requirements. For instance, if you’re a newer business, have lower credit or have smaller annual revenue, online lenders may be best for your situation. It’s also important to assess if you value an office right up the road or an online-only experience. 

Frequently asked questions about business lines of credit

How we chose our best business line of credit lenders

Clock Wait
47
years in business
Credit Card Search
30+
lenders reviewed
Loan
22
loan features weighed
Rates
770+
data points collected
To choose the best business lines of credit, we ensured all loans featured are broadly available across the United States. We then considered features that make loans affordable and accessible to businesses with different characteristics and needs, including interest rates, whether the loans are secured or unsecured, minimum annual revenue and fees.
 
Additionally, we use a 22-point scale to evaluate lenders in five key areas: Accessibility, affordability, transparency, customer service and flexibility. Based on the results, lenders are given a rating between 1 and 5:
 
  • 4.5 or higher: Outstanding
  • 4 to 4.5: Excellent
  • 3.5 to 4: Good
  • 3.5 and under: Average

*The required FICO score may be higher based on your relationship with American Express, credit history, and other factors.