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Bar Financing: Best Business Loans and Lines of Credit
Owning and operating a bar or buying new equipment takes a large chunk of start-up capital. Our team of financial experts reviewed and ranked the best small business lenders to help you get the bar financing you need.
Written by:Page Grossman
Reviewed by: Sarah Brooks, Personal Finance Writer and Editor
While operating a bar might look simple from the outside, it can cost tens of thousands of dollars just to get one up and running. If you’re looking to open in an urban area or operate a combination of a bar and restaurant, though, you’re likely looking at start-up costs into seven figures. When opening a bar, there are many expenses to think about, such as:
- Rent or mortgage for the physical space of the bar
- Funds to renovate or update the space
- Money to make necessary repairs
- Financing to buy equipment and supplies
- Enough capital to help you operate at a loss for the first few months
- Money to pay your staff
Luckily, a small business loan can be used to pay for most, if not all, of these expenses.
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Top Picks for The Best Bar Financing Options
- American Express® Business Line of Credit - Best for Bars with Fair Monthly Revenues
- National Funding - Best for Bar Equipment Loans
- Backd - Best for Cheapest Interest Rates
- GoKapital - Best for Merchant Cash Advances
- Bluevine - Best for Business Lines of Credit for Bars
- Biz2Credit - Best for Covering Start-up Costs
- Fundbox - Best for Customer Service
When you’re looking for bar financing, it can be smart to apply with multiple lenders to see who can help you get the best deal with the lowest interest rates. In this review we highlight the rates, fees and terms of each lender and explain what makes them a good option. We also share potential downsides of each lender, and provide a rating methodology you can use to select the best option for your needs.
Best Bar Financing Loans and Lines of Credit
Best Overall
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American Express Business Blueprint™ - Best for Bars with Fair Monthly Revenues
Average Monthly Revenue
At least $3,000
Min. Time in Business
12 months
Min. Credit Score
640+
Key Features
- Monthly fee: 3-9% for 6 month loans, 6-18% for 12-month loans, 9-27% for 18-month loans
- Loan amounts ranging from $2,000 to $250,000
- No prepayment penalties and no origination fees
- Convenient application process
Pros & Cons
- Straightforward application
- Fair monthly revenue requirements
- No prepayment penalties
- Personal guarantee required
- Rates may be high
Overview
American Express Business BlueprintTM program hosts the American Express® Business Line of Credit product. The lender focuses on small business lines of credit. A line of credit differs from a term loan in that you draw on the money up to the maximum amount, pay it back with interest, and then can borrow it again. It’s a revolving type of loan, similar to a credit card.
Main Features
American Express Business Blueprint offers businesses lines of credit from $2,000 to $250,000. Terms are six, 12, or 18 months from each draw. For six-month loans, rates are 3-9%; for 12-month loans, rates are 6-18%; and for 18-month loans, rates are 9-27%.
To qualify, you’ll need to be in business for at least one year and you’ll need a minimum credit score of 640. However, all businesses are unique and are subject to approval and review. The average monthly revenue requirements are at least $3,000, which is typically much lower than you’ll see with other lenders.
American Express Business Line of Credit is a solid choice if you’re looking for a line of credit and meet their minimum requirements. An advantage of a line of credit is you can continue to use the funds as long as your line isn’t maxed out. This allows you to access your money when you need it, as opposed to in one lump sum.
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National Funding - Best for Bar Equipment Loans
Min. Annual Revenue
$250,000
Min. Time in Business
6 months
Min. Credit Score
600+
Key Features
- Borrow up to $500,000
- Fast funding
- Early payment discounts
- Loan Repayment 2-5 years
- Factor rate From 1.10
Pros & Cons
- Easy application with minimal paperwork
- Fast in as little as 24 hours of loan approval
- Early payment discounts
- High annual revenue requirements
- Can be expensive
- No mobile app
Overview
With an equipment loan from National Funding, you can receive the cash you need to ensure your bar has the latest and greatest equipment. Depending on your finances and unique situation, you may get approved for up to $250,000 to cover the cost of ice machines, cocktail strainers and shakers, high tables, stools, and more.
Main Features
National Funding’s equipment loans go up to $150,000 with repayment terms between two and five years. You can expect a starting pay rate of 1.10 and will need to repay what you borrow every month.
To qualify for an equipment loan, you’ll need a credit score of at least 600, two years or more of business history, and $250,000 or more in annual revenue.
If your bar earns at least $250,000 in annual revenue and you’d like to upgrade your equipment, a National Funding equipment loan may help. You can receive your funds within 24 hours and won’t have to come up with a down payment.
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Backd - Best for Large Bar Loans
Min. Annual Revenue
$300,000
Min. Time in Business
One year
Min. Credit Score
600+
Key Features
- Borrow up to $2 million
- Industry best factor rate for MCA - as low as 1.10
- APR for the Line of credit product starts at 35%
- Flexible repayment terms up to 16 months
- Get funding in as little as 24 hours
- Check your rate with a soft credit pull
Pros & Cons
- Loans up to $2 million
- Fast funding times
- No collateral required
- Flexible payment options
- Must be in business at least one year
- Startups will not qualify
Overview
If you need a loan up to $2 million, whether that’s to renovate your existing space, purchase a new one, or simply have more capital at your disposal, Backd can help. Backd was founded in 2018 to help small businesses acquire the funding they need. They tailor their loans specifically to your business, making sure you get the best loan possible for your unique situation.
Main Features
Backd offers working capital loans up to $2 million and business lines of credit up to $750,000. Working capital loans must be paid within 16 months, but payments can be made daily, weekly, or semi-monthly. Business lines of credit have no set terms and can be used again and again. Neither loan requires collateral, but to qualify you must be in business for at least one year and have $100,000 or more in annual revenue.
If you’re earning more than $100,000 per year and need additional funding, Backd could be the solution you’ve been looking for. The application takes just a few minutes to fill out and you’ll receive a lending decision almost instantly. If you accept the loan, funds will be in your account within 24-48 hours.
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GoKapital - Best for Merchant Cash Advances
Min. Annual Revenue
$240,000
Min. Time in Business
12 months
Min. Credit Score
630+
Key Features
- Borrow up to $5 million
- Loan Terms 2 to 10 years
- Interest rates start at 25%
- Wide range of loan offers
- Simple application process
- Instant pre-approval
Pros & Cons
- Easy online application
- Many loan products to choose from
- Large merchant cash advance amounts
- Same day funding
- Excellent customer service
- Payments must be made daily or weekly
- High income requirement
Overview
GoKapital offers six different types of loans to bar owners, including merchant cash advances. A merchant cash advance allows you to borrow on future credit and debit card transactions, allowing you to have more flexibility over your loan repayment schedule. Rather than paying a fixed amount each month, you’ll pay based on your profits. This is especially ideal for bars who may experience slow periods.
Main Features
GoKapital merchant cash advances range from $20,000 to $5 million with terms between three and 18 months. All industries qualify, which is great if you’ve been denied by other lenders due to being in the restaurant industry. To qualify for a merchant cash advance, you need a minimum credit score of 550, one year of business history, and annual revenues of $360,000 or more. If you don’t meet the revenue requirement, GoKapital offers a startup business loan with a $50,000 annual revenue requirement. In addition, the company offers commercial loans which can be used to remodel your current restaurant or purchase a second location. It doesn’t cost you anything to apply, and only a soft pull is done on your credit initially, making it virtually risk-free to see your options.
GoKapital is our top pick for merchant cash advances due to their low credit requirement and large loan amounts. We also love that the company offers other types of loans, too. Regardless of your financing needs, GoKapital can help get you the funds you need to grow your restaurant business.
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Bluevine - Best for Business Lines of Credit for Bars
Min. Annual Revenue
$120,000
Min. Time in Business
6 months
Min. Credit Score
625+
Key Features
- Funding up to $250,000
- Interest rates as low as 4.8%
- Loan Repayment 6-12 months terms
- Quick and simple application
Pros & Cons
- Quick access to short-term funding
- Monthly or weekly payment options
- Excellent customer support
- Short repayment terms and high interest rates
- Personal guarantee required
Overview
Bluevine is an online lender that offers small business lines of credit. The application takes just a few minutes to fill out, and you can receive a funding decision in as little as five minutes.
Main Features
Bluevine offers bar owners lines of credit up to $250,000 with rates starting at 4.8%. Each draw is paid back weekly or monthly over six or 12 months, and your available credit will automatically increase as you make your payments.
To qualify for a line of credit from Bluevine, you’ll need a minimum credit score of 625, $10,000 in monthly revenue, and to have been in business for at least six months.
A line of credit from Bluevine can help your bar business pay for operating expenses, open a new location, or purchase inventory. It works great for those that think they’ll need continuous access to funds.
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Biz2Credit - Best for Multiple Loan Products
Min. Annual Revenue
$250,000
Min. Time in Business
6 months
Min. Credit Score
600+
Key Features
- Borrow up to $2 million
- Loan Repayment 12-36 months terms
- Variable APR depending on the applicant
- Multiple loan types available
- Funding in 72 hours
- Soft credit pull
Pros & Cons
- Multiple loan types available
- Fast decision and funding times
- High borrowing limits
- Requires high annual revenues
- Additional fees may apply
Overview
Since its founding in 2007, Biz2Credit has provided over $7 billion in loans to thousands of small businesses. After completing their online application, your small business is automatically matched with the best funding sources for your needs. Biz2Credit specializes in loan products such as working capital, term loans, and commercial real estate loans.
Main Features
If you’re looking for bar financing, Biz2Credit offers a number of different loan products that can help to fill your unique financing gaps. They offer working capital loans starting at $25,000, term loans up to $500,000, and commercial real estate loans up to $6 million. Rates will vary by loan type and lender, but typically start at 8.99%.
To qualify for a loan from Biz2Credit, you’ll need a minimum credit score of 575 for working capital loans and 660 for term loans and commercial real estate loans. Minimum annual revenue is $250,000 across all three products, and you need to be in business for at least six months for a working capital loan. For term loans and CRE loans, the minimum time in business is 18 months.
Biz2Credit offers high loan limits for qualified borrowers. If your bar business meets the minimum qualifications, they are a lender worth pursuing.
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Fundbox - Best for Customer Service
Min. Annual Revenue
$120,000
Min. Time in Business
6 months
Min. Credit Score
600+
Key Features
- Borrow up to $150,000
- Loan repayment 6-12 months terms
- Interest rate 4.66% minimum
- No monthly fees or prepayment penalties
- Same-day or next-day funding
- Best for business lines of credit
Pros & Cons
- Simple, automated application process
- Fast funding times
- Flexible repayment terms
- Small credit limit
- Interest rates can be high
Overview
Fundbox offers both loans and lines of credit to small businesses up to $150,000. You can apply without it affecting your credit score, and you’ll receive an approval decision in as little as three minutes. If approved, funds can be in your account as soon as the next business day.
Main Features
Fundbox loans and lines of credit range from $1,000 to $150,000. Term loans have a repayment period of 24 or 52 weeks, with interest rates starting at 8.33% for 24-week terms. Lines of credit have a repayment period of 12 or 24 weeks, with rates starting at 4.66% for 12-week terms.
To qualify for a loan or line of credit, you’ll need a minimum credit score of 600 and $100,000 in annual revenue. You’ll also need to be in business for at least six months.
Fundbox is a great option for bar owners who need up to $150,000 and can pay it back in a short period of time. Their customer service is excellent, and you can reach out to representatives via phone, email, or social media. If you're worried about your credit score and are still in need of a line of credit, Fundbox is a great option. It offers loans for small businesses with 500 and higher and doesn't require collateral.
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How We Choose the Best Loan for Your Bar
When it comes to choosing the right loan and lender for your small business, there are a number of unique factors that you should consider.
- Loan features: We looked at features such as how much you can borrow and what the repayment terms are.
- Application process: Each lender has a different application process. We looked for ones that don't take very much time and that you’re able to do entirely online.
- Interest rates and fees: Some lenders charge additional fees on top of interest rates, and rates can vary from lender to lender.
- Qualification process: Lenders have specific requirements for small businesses that they work with, such as time in business and annual revenue requirements.
- Customer support: When you have questions about your loan, you’ll want to be able to reach the right person via both email and phone.
- Online user reviews: We read online reviews from sites such as Trustpilot of the different lenders to learn more about the pros and cons of each.
- Perks and bonuses: Some lenders offer additional perks, such as a grace period for late payments, advertising transparency, and advanced technology.
Main Features of The Best Bar Financing Options
| Company | Min. Credit Score | Min. Time in Business | Min. Revenue | Loan Amount | Interest Rate |
| American Express Business Line of Credit | 640 | 12 months | Average monthly revenue: at least $3,000 | $2,000 - $250,000 | 6-month loans: 3-9%; 12-month loans: 6-18%; 18-month loans: 9-27%; |
| Biz2Credit | 575 | 6 months | $250,000 | Term loans up to $500,000 CRE loans up to $6 mil | 8.99%+ |
| National Funding | 600 | 2 years | $250,000 | Equipment loans up to $150,000 | Factor rates start at 1.1 |
| Bluevine | 625 | 6 months | $120,000 | $5,000 - $250,000 | 4.8%+ |
| Fundbox | 600 | 6 months | $100,000 | $1,000 - $150,000 | 12-week terms: 4.66%+ 24-week terms: 8.33%+ |
| Upstart | 550 | 12 months | N/A | $5,000 to $200,000 | Max 35.99% APR |
| GoKapital | 550 | 1 year | $360,000 | $5,000 - $5 million | Factor rates starting at 1.20 |
How Much Does it Cost to Open a Bar Business?
Bars may not suffer from seasonality as much as a hotel on the beach does, but a bar does often experience changes in pace during the course of a year.
Savvy managers may have money put aside for at least six months. However, most bar businesses primarily rely on the money they get from their customers.
Let’s take a look at some of the expenses bar owners will have to incur.
- Rent or real estate purchase: You'll either be renting or buying your bar location. Although renting adds a substantial amount to your monthly expenses, buying will require a huge amount of starting capital.
- Construction or renovations: Not all spaces come as you imagine them. Chances are that you'll need to do some renovations and construction work. You will also need to pay for permits, materials, and workers.
- Sound and lighting: A bar business should have a wow factor to set you apart from the competition. Having professional lighting and sound equipment is often necessary for bars.
- Taxes, licenses, and permits: When you serve alcohol and food, you will need to pay a fee to the local authorities. Learn what these fees are and include them in your financial plan.
- Utilities: Utilities will be one of your largest recurring payment categories, including heating and cooling during the warm and cold seasons.
- Payroll: While you might need to consider contractor payments when you are starting out, your basic payroll should be predictable and constant.
- Marketing: While word-of-mouth and events might help you with your advertising, don't forget to invest in your online presence. Use social media ads to expand your audience and promote your brand.
- Inventory: Drink mixers, cocktail glasses, and attributes all cost money. These are part of your brand, so you might want to spend a little on these items. Alcohol and soft drink purchases may take up a large bulk of your resources, both in the initial stage and during operation.
Cash Flow Tips for Bar Owners
While a small business loan can help you fill a cash flow gap or purchase a new piece of equipment, the day-to-day operations of your bar are dependent on your ability to manage your cash flow. Here are a few tips.
- Prepare for unexpected expenses: Whether it’s a piece of equipment needing repair or hiring and training a new employee, unexpected expenses are always popping up for small businesses. Have a small slush fund.
- Sign up for a business bank account: A business bank account is necessary for you to get business financing and separate your business and personal finances.
- Get a business credit card: A business credit card can help you to manage small cash flow gaps by paying for large expenses over time.
- Use a business savings account for emergencies: A business savings account allows you to set aside funds to help pay for emergencies. Keeping this money in a savings account makes it just a little bit harder to spend without planning ahead.
- Financing affects your cash flow: If you do plan to get a loan for your small business, be sure to look into the future to see how that will affect your cash flow.
Bottom Line
No matter what business you operate, getting a loan can be a time-consuming activity. And, it can be challenging to get approved. Luckily, our experts have hand-picked the top small business loans for bar owners, simplifying the process for you and helping you find the best rates and terms available today.
Frequently Asked Questions
How much of a loan can I get for a bar?
Can you get a bank loan to open a bar?
Yes, you can get a bank loan to open a bar or start a bakery, but the requirements are stricter and it will take longer to get approved and funded. Banks want a guarantee that you’ll be able to pay back your loan. With a new business, they have very little data and information to base their assessments on. If you’re looking to get a loan for a new business, you’ll likely have to offer a personal guarantee and personal financial information in return.
What licenses do you need to open a bar?
How much does it cost to run a nightclub?
Your monthly cash flow needs will depend greatly on the size of your bar or nightclub. If you’re operating in a small town, your expenses and income will be much lower than if you’re operating a large establishment in an urban setting.
About the Author
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Written by: Page Grossman
Page is a freelance intentional lifestyle writer who has written financial content for Fundera, Zeni, Incfile, FamFi, and Zendesk.
More about me)
Reviewed by: Sarah Brooks
Sarah Brooks is a personal finance writer and editor with more than 10 years of experience. She specializes in personal and business loans, mortgages, auto loans, and credit cards.
More about meRelated Loan Picks
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