E-Commerce Business Loans: Best Options for Online Stores

Running an ecommerce business can be less expensive than brick-and-mortar businesses, but there are still many expenses that come with the territory. If you are in need of financing for your ecommerce business, SMB Compass can help. The lender offers nine different types of loans, including SBA loans, lines of credit, business term loans, equipment financing, invoice factoring, and more. Customer service is excellent and representatives are available to help you choose a loan and walk you through the process. To qualify, you need a credit score of 650, at least one year of business history, and $20,000 or more in monthly revenue.

Main Features

SMB Compass offers nine different types of small business loans to borrowers, including those in the ecommerce business. Their mission is to make loans more accessible to small business borrowers by providing cost-effective and flexible lending solutions. SMB Compass business loans range from $10,000 to $10 million with terms up to 25 years. Rates start at 7.99% for qualified borrowers. The lender has currently provided more than 1,200 U.S. businesses with more than $250 million in financing. To apply, simply fill out their easy online application. It takes just a few minutes and will not impact your credit score. If approved, funding can be dispersed within 24 hours.

Uncapped has developed a loan product that is conducive to e-commerce businesses. In fact, the lender only works with businesses with an online model. You can choose either fixed-term or revenue-based financing, which helps protect you from unaffordable payments.

Main Features

You can borrow between $10,000 and $10 million from Uncapped to grow your e-commerce business. Instead of charging interest, the lender charges a flat fee as a percentage of the loan amount, which ranges from 2% to 12%. There are no other costs, such as origination fees or prepayment penalties.

You can choose to repay the loan in fixed installments over three to 24 months, or you can repay between 5% and 25% of your monthly sales until the principal and fee have been repaid. There’s no minimum credit score required, but you’ll need to have at least six months in business and earn $10,000 or more in monthly revenue to be eligible.

Biz2Credit connects you with lenders that offer working capital funding for e-commerce businesses and term loans that can be used for a variety of business needs. It’s best for businesses with at least six months of history that need more than $25,000 in working capital.

Main Features

With Biz2Credit, you can borrow anywhere from $25,000 to $2 million in working capital funding or up to a $500,000 term loan. Term loans have a 12- to 36-month term with simple interest starting at 7.99% plus an origination fee, while working capital loan terms and rates vary by lender.

You can repay daily, weekly, or bi-weekly. Most customers who are approved for working capital have at least six months of business history, annual revenue above $250,000, and a minimum 575 credit score. Most customers who are approved for a term loan have at least 18 months in business and a minimum 660 credit score.

Bluevine offers credit lines up to $250,000 with quick approvals, low starting rates, and no monthly fees or prepayment penalties. Bluevine is a great fit for creditworthy business owners who need ongoing access to funds. E-commerce business owners who don’t want to apply for new credit every time they need it, such as those who need capital for new product drops, may find Bluevine’s line of credit meets their needs.

Main Features

Bluevine offers lines of credit from $5,000 to $250,000 with simple interest rates starting at 4.8%. With a Bluevine line of credit, you can draw funds as needed and repay in fixed monthly or weekly payments over six or 12 months. Interest rates will likely be lower than a business credit card and you can borrow more at a time.

To be eligible for a line of credit from Bluevine, you must have a personal credit score of at least 625, at least six months of business history, and at least $10,000 in monthly revenue. As you make payments, you’ll build business credit and gain access to more funds.

If you need to cover day-to-day expenses, a working capital loan from National Funding can be a good fit. You may use the proceeds for payroll, platform payments, permits and licenses, and anything else you need to run your e-commerce store successfully.

Main Features

National Funding’s short-term working capital business loans range from $5,000 to $500,000 with repayment terms between four months and two years. The pay rate starts at 1.10. For a chance at approval, you’ll need a credit score of at least 600, a business history of six months, and $250,000 or more in annual revenue. If you pay your loan in full within 100 days, you’ll receive a 7% discount on your balance.

Backd was founded in 2018 and has since funded more than 10,000 small businesses, including those in ecommerce. Backd understands that obtaining funding through traditional banks can be a hassle and time-consuming, so they’ve made sure to make the process as quick and seamless as possible with the hopes of getting more businesses the funding they need. So far, they’ve succeeded and continue to help small businesses prosper.

Main Features

Backd offers two products: working capital loans and business lines of credit. Working capital loans range from $10,000 to $2 million with terms up to 16 months. This type of loan is best for ecommerce businesses who have a one-time expense and are able to pay back the loan quickly. A business line of credit, on the other hand, is for those that want access to funds for an unlimited period of time. There are no terms, and you can borrow up to $750,000. To qualify for either option, you need to be in business for at least two years, have $300,000 or more in annual revenue, and 640+ FICO score.

If you’ve previously been denied a loan for your ecommerce business, don’t let that stop you from giving Lendzi a chance. Lendzi was founded in 2020 and caters to borrowers with high revenue who have been denied a business loan elsewhere. They are a direct lender in addition to partnering with more than 75 other lenders, increasing your odds of qualifying for a loan.

Main Features

Lendzi’s working capital loans are up to $400,000 and range from three to 15 months, with factor rates starting at just 1.15. The credit score requirement for this type of funding is just 500, making this the ideal type of loan for ecommerce businesses that have been denied a loan due to poor credit.

If credit is not your issue, Lendzi offers six other types of small business loans, including equipment financing, merchant cash advances, short- and long-term loans, business lines of credit, and SBA loans. Applying takes just a few minutes online, and once you submit your application a representative will give you a call. To qualify, you should have a business history of at least six months and $180,000 or more in annual revenue.