Beauty Salon Loans: Best Options To Consider in 2023

American Express Business Blueprint™ program hosts the American Express® Business Line of Credit product. The lender offers a business line of credit that can be useful for either large, one-time purchases or ongoing expenses. These types of unsecured loans can be useful for cyclical businesses like beauty salons that experience slower volume during downturns. 

Main Features
American Express Business Line of Credit come with a limit that can vary between $2,000 and $250,000 and a repayment term of either 6, 12, or 18 months. Unlike many of its competitors, American Express charges a monthly fee instead of an APR. Fees are due whenever there is a balance on the credit line. While these fees can add up, remember that lines of credit are meant to be paid off quickly. If you manage to pay off the loan early, you can reduce the costs considerably. The fee structure is: 3-9% for 6-month loans, 6-18% for 12-month loans, 9-27% for 18-month loans.

Backd was founded in 2018 and tailors their loans to each individual business. No two businesses are alike, and no two loans should be, either. If you’re in need of additional funding for your beauty salon business - whether that’s to expand your business or purchase new equipment - Backd has a loan that could work for you.

Main Features
Backd offers working capital loans up to $2 million and business lines of credit up to $750,000. Beauty salons looking to fund one big project may fare best with the working capital loan. On the other hand, if you’re looking to have cash on hand at any given time at your disposal, a business line of credit may be in your best interest. The working capital loan must be paid back within 16 months, and payments can be made daily, weekly, or semi-monthly. The business line of credit is a bit more flexible - terms are unlimited and you pay for what you use, and can then choose to use the funds again. To qualify, you must be in business at least one year and have $100,000 or more in annual revenue

Lendzi caters to small business owners with high revenue that have been denied a loan elsewhere. The company was founded in 2020 and has since funded more than $500 million to small businesses. They are a direct lender and a lending marketplace, which increases your odds of getting a beauty salon loan, even if you have poor credit.

Main Features
Lendzi features seven different types of small business loans, three of which do not require a high credit score. A working capital loan requires a score of 500 and allows you to borrow up to $400,000 for your beauty salon business. Factor rates start at 1.15 and terms range from three to 15 months. Lendzi also offers equipment financing up to $2 million. The minimum credit score accepted on this type of funding is 550, and rates start at 3.49%. Finally, Lendzi offers merchant cash advances to beauty salon businesses with poor credit. These require a credit score of 525 and range from $5,000 to $400,000. Terms range between three and 15 months, and factor rates start at 1.10. To qualify, Lendzi prefers a business history of six months and an annual revenue of $180,000 or more.

National Funding offers equipment loans for beauty salons. You can borrow up to $150,000 to buy or use equipment, such as hood dryers, washing machines for towels, hair straighteners, hair curlers, brushes, and combs. 

Main Features
National Funding’s equipment loans go up to $150,000 with repayment terms between 2 and 5 years. You’ll repay your loan on a monthly basis. To qualify for an equipment loan, you’ll need a credit score of 575+, at least 6 months of business history, and $250,000 or more in annual revenue.

GoKapital is our top pick for multiple loan options. Founded in 2013, the company offers small business term loans, merchant cash advances, business lines of credit, equipment financing, SBA loans, and startup loans. They also accept all industries and are available in all 50 states, so if you’ve been denied a loan elsewhere because you’re in the beauty industry, look no further than GoKapital.

Main Features
GoKapital small business loans for beauty salons range from $5,000 up to $5 million. Terms vary, but most are between one and five years with payments made weekly or monthly. SBA loans come with the lowest rates, starting at just 4%. When you apply, you should receive a lending decision within 24 hours and, if approved, funds within just a few business days. To qualify, GoKapital prefers a minimum credit score of 500, one year of business history, and $240,000 or more in annual revenue. If you don’t meet the revenue requirement, GoKapital’s startup loans require just $50,000 in annual revenue.

For a beauty salon owner, having access to a Bluevine business line of credit can prove useful–whether for daily spending or unforeseen expenses. The application process for a Bluevine line of credit is easy and takes no longer than a few minutes. The funding decision is fast as well, and, should you get approved, you can expect to receive the funds in a matter of hours. When considering this form of beauty salon financing, keep in mind that Bluevine loans aren’t available in some states, such as North and South Dakota. Make sure to review the complete list before applying.

Main Features
With Bluevine, you can receive a business line of credit ranging between $5,000 and $250,000, with a term of either 6 or 12 months. However, it is a good idea to pay off the loan sooner to reduce the borrowing costs, as the interest rate can get quite expensive. Because the line of credit is unsecured, it is a little more difficult to qualify for: your business must be in operation for at least 6 months with an annual revenue of $120,000 or more. In addition, your personal credit score must be no less than 625.

A working capital loan from Biz2Credit can be used to finance daily business operations, such as purchasing beauty supplies and paying employee salaries. If you gather all of the required documentation in advance, you can get approved as quickly as 24 hours.

Main Features
With a Biz2Credit working capital loan, you can receive up to $2 million and choose between bi-monthly, weekly, or daily repayment periods. The interest rate and term length can vary, and the specifics will be discussed with the lender during the application process. To qualify for the funding, your beauty salon must be in operation for at least 6 months, with a yearly revenue of $250,000 or more. In addition, your personal credit score must be no less than 575.