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Best Working Capital Loans to Consider in 2023
Working capital loans help you access the cash you need in order to fund everyday expenses. These business loans can help cover payroll, pay for day-to-day operations, or help keep your cash flow stable. Best of all, you may not need to put up collateral.
Written by:Brian T. O'Connor
Reviewed by: Sarah Brooks, Personal Finance Writer and Editor
Fact Checked by: Dr. JeFreda R. Brown, Financial Expert
A working capital loan is the ideal choice if you need to borrow quickly to increase cash flow and can’t wait on a traditional bank loan. The best working capital loans offer a quick approval timeline, which puts cash in your hand within 24 hours of loan approval. In contrast, some bank loans can takes months from application to approval.
If you’re looking for the business loans that can help you tap into the funding you need, look no further. Our team of financial experts reviewed and ranked the top online lenders to help you get funded.
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Top Picks for Best Working Capital Loans
- American Express® Business Line of Credit - Best for Fair Revenue Requirements
- Lendzi - Best for Businesses With High Revenue
- Backd - Best for Cheapest Interest Rates
- National Funding - Best For Repayment Discounts
- Bluevine - Best for Line of Credit
- Biz2Credit - Best for Fast Approval
- Fundbox - Best for Low Fee Loans
- GoKapital - Best for Instant Pre-Approval
Working capital loans can take the form of short-term business loans or a business line of credit, depending on your needs.
In this review, our experts 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 Working Capital Loans for 2023 - Full Overview
There are several leading business loans you can use for working capital. Each of the following lenders offers different benefits for business owners, as well as different applicant requirements.
Best Overall
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American Express Business Blueprint™ - Best for Fair Revenue Requirements
Average Monthly Revenue
At least $3,000
Min. Time in Business
12 months
Min. Credit Score
640
Key Features
- Monthly fees: 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
- Fair annual revenue requirements
- Fair credit score requirements
- No prepayment penalties
- Personal guarantee required
- Monthly fee structure can be confusing
Overview
American Express Business BlueprintTM program hosts the American Express® Business Line of Credit product. The lender offers working capital in a form of business line of credit. American Express Business Blueprint prides itself on empowering small businesses and helping them get the funding they need to succeed.
Most lenders require high annual revenues to qualify for a working capital loan. American Express, however, requires an average monthly revenue of at least $3,000. This gives businesses a chance to increase their revenue by providing them with the money they need to do so.
Main Features
American Express Business Blueprint provides lines of credit to small businesses ranging from $2,000 to $250,000. American Express does not charge originations fees or prepayment penalties, but rather a monthly fee on your balance. For 6-month loans, fees range from 3-9%. For 12-month loans, they range from 6-18%, and for 18-month loans, fees range from 9-27%. To qualify, you’ll need a business checking account or online payment platform, be in business for at least one year, be able to show at least $3,000 in average monthly revenue, and have a minimum credit score of 640. However, all businesses are unique and are subject to approval and review.
American Express Business Line of Credit is ideal for businesses looking to increase their profits but perhaps need a loan to do so. With fair monthly revenue requirements and flexible funding, American Express Business Line of Credit is an excellent choice for working capital loans.
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Lendzi - Best for Businesses With High Revenue
Min. Annual Revenue
$180,000
Min. Time in Business
6 months
Min. Credit Score
500
Key Features
- Borrow up to $400,000
- Competitive starting rates on most products
- See your options without hurting your credit
- Flexible terms: 3 to 15 months
- Factor rates starting at 1.15
- Excellent customer reviews on independent review sites
Pros & Cons
- Bad credit accepted
- Flexible terms
- Competitive rates
- Fast funding times
- Excellent customer service
- Multiple phone calls required after application
- Annual income requirement may be high
Overview
If your business has high revenue and you have been denied a loan elsewhere, Lendzi may be able to help you get the funding you need. Lendzi was founded in 2020 and caters to small businesses who may have trouble getting a loan. Not only that, but they have more than 2,000 5-star reviews from past and present customers, they offer competitive rates and terms, and they can get you your funding within 24 hours of loan approval.
Main Features
You can get a working capital loan from Lendzi up to $400,000 with terms between three and 15 months. Factor rates start at 1.15 and credit score isn’t an issue with this type of funding, though the lender does recommend a score of at least 500. To apply, simply fill out the online application. Doing this will not impact your credit score. From there, a Lendzi representative will contact you to discuss your financing needs further. You will be guided throughout the process and together will come up with a funding solution. To qualify, Lendzi recommends a business history of at least six months and $180,000 in annual revenue.
Lendzi is our top pick for small businesses with high revenue who need a working capital loan. Whether you need additional funds to help cover operating expenses or are rolling out a new marketing plan, Lendzi can help you find the right solution and get you approved quickly.
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Backd - Best for Cheapest Interest Rates
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
- Fast lending decisions and funding times
- No collateral required
- Large loan amounts
- Not available for startups
- Some industries will not qualify
- Rates not disclosed prior to application
Overview
Backd was founded in 2018 and offers working capital loans up to $2 million. They tailor to businesses who want to stay in control of their finances, and work to create a unique loan specifically for your business. The online application takes just a few minutes to fill out and a lending decision is given almost instantly. If approved, funds can be in your account within 24-48 hours.
Main Features
Backd working capital loans range from $10,000 to $2 million with terms up to 16 months. Payments are made daily, weekly, or semi-monthly. In addition, Backd offers a business line of credit ranging from $10,000 to $750,000. With this type of financing, you withdraw funds, pay them back, and can withdraw them again. To qualify for either option, you need to be in business for at least one year and have $100,000 or more in annual revenue.
If you’ve been denied elsewhere and are in need of a large loan amount, Backd may be able to get you the funding you need. As long as you meet their minimum qualifications, it’s worth applying for a working capital loan and seeing what they have to offer.
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National Funding - Best For Repayment Discounts
Min. Annual Revenue
$250,000
Min. Time in Business
6 months
Min. Credit Score
600+
Key Features
- Fast funding
- Borrow up to $500,000
- Early payment discounts
- Loan Repayment 2-5 years
- Factor rate From 1.10
Pros & Cons
- Credit score not impacted with application
- Positive reviews on sites like Trustpilot and Better Business Bureau (BBB)
- No collateral needed
- Daily or weekly repayments
- Personal guarantee required
- No mobile app
Overview
National Funding working capital loans come with an early repayment discount. You can lock in a 7% discount on your remaining balance if you pay off your business loan in full within the first 100 days. This can make it more affordable to boost cash flow and fund the cost of everyday expenses like rent, payroll, and utilities or get you through slow seasons.
Main Features
National Funding’s 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. To pursue a working capital loan, you’ll need a minimum credit score of 600, a business track record of at least six months, and $250,000 or more in annual revenue.
If your business is financially stable and you could use some cash to pay for everyday expenses, a working capital loan from National Funding might be a solid choice. This is particularly true if you know you’ll be able to repay it in full within the first 100 days and qualify for the early repayment discount.
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Bluevine - Best for Line of Credit
Min. Annual Revenue
$120,000
Min. Time in Business
6 months
Min. Credit Score
625
Key Features
- Funding up to $250,000
- Quick and simple application
- Interest rates as low as 4.8%
- Loan Repayment 6-12 months terms
Pros & Cons
- Quick and easy application
- Funds available in hours or days of loan approval
- Accessible customer service
- Also offers a competitive checking account
- High late fees
- High repayments due to 6-12 month terms
- High interest rates for lower credit scores
Overview
Bluevine offers a business line of credit up to $250,000 that can help you get the working capital you need. This option is ideal for business owners who may want to dip into capital repeatedly without having to apply for a loan each time. Bluevine also deposits and withdraws funds directly from a linked checking account, which can provide speed and convenience. Bluevine runs a soft credit pull when you apply to help avoid negative changes to your credit.
Main Features
Bluevine’s line of credit comes with a simple online application process and a decision within five minutes. Loan amounts range from $5,000 to $250,000 with rates starting at just 4.8%. As you pay off your line of credit, your available credit automatically replenishes up to your maximum loan amount for you to use again.
Bluevine also stands out in terms of customer service. The lender offers person-to-person customer support in addition to its online platform, which can go a long way when you have an issue getting paid or with repaying your loan.
Bluevine is an alluring option for businesses that can afford the faster repayment period, and for those who want a line of credit versus a term loan. Their customer service and loan totals can help you get the funds you need with minimal hassle.
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Biz2Credit - Best for Fast Approval
Min. Annual Revenue
$250,000
Min. Time in Business
6 months
Min. Credit Score
600+
Key Features
- Borrow up to $2 million
- Variable APR depending on the applicant
- Loan Repayment 12-36 months
- Multiple loan types available
- Funding in 48h
- Soft credit pull
Pros & Cons
- Funds hit your account in three business days
- High maximum loan totals provide flexibility
- Decent interest rates
- Application requirements can be hard to meet
- Loans may come with additional fees
- Higher minimum annual revenue required
Overview
Biz2Credit is known for offering a fast turnaround time between application to funding. In most cases, Biz2Credit can get funds deposited within 72 hours after loan approval. This makes the lender an ideal funding source if your small business needs fast access to capital.
Main Features
Biz2Credit’s working capital loans are its most flexible in terms of minimum credit score. You will need $250,000 in annual revenue and six months of operating time to qualify.
Biz2Credit loans also come with significantly higher maximum loan amounts—up to $2 million. Interest rates are competitive, but qualifying for a loan can be harder here than with other lenders.
Biz2Credit offers high maximum loan amounts, but also requires substantial annual revenue from your business. Their application process is more stringent, but rates will be more competitive and funding times are fast once approved.
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Fundbox - Best for Low Fee Loans
Min. Time in Business
6 months
Min. Annual Revenue
$120,000
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
- Fast application process and payment
- Soft credit pull doesn’t lower credit score
- Two flexible repayment period options
- No additional loan fees
- High interest rates
- Small credit limit (typically $150,000)
- Auto-debit loan repayments
Overview
Fundbox offers two business loans that can help provide you with working capital: A term loan and a line of credit. For either loan, the application only requires a soft credit pull, which does not impact your credit score. Plus, Fundbox is also more flexible with credit scores than traditional lenders.
Part of this flexibility is due to how the company deposits your loan proceeds and how it collects on your debts. They push money directly into your checking account and withdraw from your account automatically for repayment. This underlying tech streamlines the payment process, which is part of why Fundbox is more lenient with lower credit scores.
Main Features
Fundbox offers up to $150,000 for both their term loan and line of credit. For term loans, Fundbox offers a 24 or 52 week repayment plan. For the line of credit, you choose a 12 or 24 week repayment plan each time you draw on your loan. Interest rates begin at 4.66%, but your rate could be higher depending on your credit score, among other factors. Businesses only need to have been in business for six months before applying for a loan.
Fundbox makes it easy to get a loan to boost your cash flow—even if your credit is a sensitive subject. Plus, Fundbox gets cash in your hand quickly. Decisions are made in as little as three minutes from application submission, and funds can be in your account as soon as the next business day. This is helpful if getting working capital is a time-sensitive matter, which is true in many cases.
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GoKapital - Best for Instant Pre-Approval
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
- Early payment discounts
- Poor credit OK
- Payments made monthly
- Excellent customer service
- Interest rates may be high
- High annual income requirements
Overview
If you need a working capital loan up to $5,000,000 and don’t have time to wait around for approval from a bank, look no further than GoKapital. Simply fill out their easy online application and receive a lending decision within 24 hours. If approved, funds are usually deposited the same day.
GoKapital was founded in 2013 and is on a mission to help entrepreneurs get the funding they need, regardless of industry, credit score, or time in business. In addition to working capital loans, GoKapital offers business lines of credit, merchant cash advances, equipment financing, SBA loans, and even real estate investment loans. Whether you’re looking to purchase new equipment or buy another location, GoKapital is on your side.
Main Features
Working capital loans from GoKapital range from $20,000 to $5 million with terms of two to 10 years. The minimum credit score needed is just 500; however, you will need $240,000 or more in annual revenue to qualify. In addition, you also need to be in business for a minimum of two years. If you don’t meet these requirements, GoKapital offers other forms of financing that may better suit your needs.
GoKapital working capital loans are best for medium-sized businesses in need of a large amount of capital quickly. Applying will not affect your credit score, so if you meet the minimum requirements, we recommend giving GoKapital a chance to fund your business’ needs.
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How To Choose the Best Working Capital Loans
- Loan features: This includes working capital loan terms, repayment options, and loan amounts. Most are short-term business loans, meaning they require repayment over 12 months. You may also be able to get a business line of credit, which offers you a sum of money to borrow against during a set period.
- Application process: How much information lenders require in your application. This also includes whether or not the lender needs to run a hard-pull or soft-pull of your credit score, and how long it will take to receive your funds.
- Interest rates and fees: Interest rates vary between lenders, as do fees associated with taking out a loan.
- Qualification process: The credentials lenders require from applicants, including minimum credit score, annual revenue, and business history.
- Customer support: Whether or not a lender offers access to live support representatives, as well as the availability of support across different channels. This also includes the amount and usefulness of supplemental information and tools.
- Online user reviews: What others have to say about their borrowing experience with a lender based on feedback from independent review sites.
- Perks and bonuses: Other benefits associated with borrowing from a certain lender, such as payment flexibility, advertising transparency, and advanced technology.
Main Features of The Best Working Capital Loans
| Company | Min. Credit Score | Min. Time in Business | Min.Revenue | Loan Amount | Interest Rate |
| Fundbox | 600 | 6 months | $100,000 | Up to $150,000 | 4.66% minimum rate |
| Bluevine | 625 | 6 months | $120,000 | $5,000-$250,000 | 4.8% minimum rate |
| Backd | N/A | 1 year | $100,000 | $10,000-$2 million | Not disclosed |
| Lendzi | 500 | 6 months | $180,000 | Up to $400,000 | Factor rates starting at 1.15 |
| GoKapital | 500 | 2 years | $240,000 | $20,000 - $5 million | 25% and up |
| Biz2Credit | 575 | 6 months | $250,000 | $25,000-$2,000,000 | Variable, depends on applicant |
| National Funding | 600 | 6 months | $250,000 | $5,000-$500,000 | Factor rates starting at 1.1 |
| American Express Business Line of Credit | 640 | 12 months | Average monthly revenue: at least $3,000 | $2,000-$250,000 | 6-month loan: 3-9%; 12-month loan: 6-18%; 18-month loan: 9-27% |
What Is a Working Capital Loan?
A working capital loan provides you with the funds you need in order to pay for a variety of business expenses. Unlike some loans that require you to use funds for a specific purpose, working capital loans are more flexible and can be used for a broader array of purposes.
Why Should a Business Get a Working Capital Loan?
The Voice of Small Business in America Report shows that businesses that don’t receive the funding they need are forced to make cuts in technology and equipment investments (29%) and owner’s compensation (29%). Further, 48% said that they had trouble expanding into new markets, while 42% said that they had to take on more work themselves instead of hiring employees or contractors.
Working capital loans are a good option when you need to keep your business operations running, purchase equipment, or cover other costs like payroll. Qualifications for working capital loans are usually less stringent than other term loans, which makes them an attractive option for small business owners with less than excellent credit, or for whom a traditional bank loan isn’t likely.
A working capital loan can also be a better fit if time is of the essence and waiting for a term loan from a bank isn’t feasible. Most loan decisions are made within minutes, and funds are dispersed within 72 hours from loan approval.
Types of Working Capital Loans
There are a few types of small business loans that can be used to fund capital:
- Short-term working capital loans provide small businesses with a lump sum of money with a set repayment schedule.
- Business lines of credit offer a set amount of money that you can pull from repeatedly during the life of the loan. Similar to a credit card, you only pay interest on the money you use.
- SBA loans provide up to $5.5 million to be used as working capital or to buy fixed assets like real estate and equipment. These term loans are guaranteed by the Small Business Administration.
- Merchant cash advances allow you to pay back your loan through debit and credit card sales. These loans may be a good option for businesses with relatively low credit scores but solid annual revenue.
How to Qualify for a Working Capital Loan
Each lender has its own requirements for getting a working capital loan. Prerequisites may also vary depending on which loan type you decide to pursue. For example, an SBA loan may offer lower fees and longer repayment terms but will require more paperwork and processing time, while a business line of credit may be a better choice for a smaller, short-term loan.
In general, expect the following requirements from lenders:
- Minimum credit score: 500-640
- Time in business: 6+ months
- Annual revenue: $100,000+
Depending on the loan type and lender, you may also have to provide collateral and/or a personal guarantee.
How to Get a Working Capital Loan
Most online lenders make it easy to apply for a working capital loan through their website. Some offer apps or online dashboards that simplify the process of tracking your application and managing your account if approved.
A typical application process looks like this:
- Gather your documentation including your tax ID number, financial statements, and banking information. Depending on the loan type, you may also need to prepare a business plan and provide a personal guarantee stating that you are responsible for paying off the loan.
- Apply online by following the lender’s instructions. Often, you will be assigned a representative who will guide you through the process.
- Receive your loan offer. Review the fine print, paying close attention to the loan terms, interest and payments due, and any other requirements.
- Sign your offer and receive your payments. Many lenders will link directly to your business bank account, speeding the funding process.
Best SBA lenders for small businesses >>
Working Capital vs. Term Loan
Working capital and term loans are very similar business financing, with working capital loans often taking the form of a term loan. The main difference is working capital loans do not come with rules around how you spend the money and what you spend it on. With other term loans, such as equipment financing, your lender may require you to demonstrate what you’re spending the money on. A working capital loan, however, can be used for a variety of purposes.
Both options don’t normally require collateral, which is an asset that backs the loan. However, if you have collateral you can use, it’s worth mentioning to the lender as that may score you a lower interest rate with a secured loan.
Conclusion
Working capital loans can be a great option for small business owners who need quick access to capital with a fast approval process. There are a variety of lenders who can help you get the cash you need while working with your credit score and business history.
Frequently Asked Questions(FAQ)
Are working capital loans a good idea?
These business loans can help small business owners cover short-term business expenses like payroll, inventory, or rent. This type of business financing is a good option for companies experiencing a temporary shortfall. However, if the business doesn’t improve, borrowers can find themselves saddled with debt.
What are the dangers of working capital loans?
Many types of working capital loans come with high interest rates, which can add up if borrowers are not able to make timely payments on business financing.
Can you get a working capital loan with bad credit?
Business owners can get a working capital loan with a credit score of 500+. Lenders consider factors like time in business and annual revenue in their approval process.
What is the interest rate range on working capital loans?
Interest rates on these loans vary widely by lender and working capital loan type. You may find APRs as low as 4.6% and as high as 36%.
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Written by: Brian T. O'Connor
Brian is a small business writer, focusing on the best ways for entrepreneurs to get their business off the ground. Brian is the co-owner of Brunch Money, a digital strategy agency based in Connecticut.
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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 me)
Fact checked by: Dr. JeFreda R. Brown
Dr. JeFreda R. Brown is more than a financial consultant: she’s an avid teacher and subject matter expert who helps people—individuals and groups in a business setting—master the skills they need to achieve lasting financial wellbeing. As Founder and CEO of Xaris Financial Enterprises, it is her passion and life goal...
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