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Indiana Small Business Loans and Grants

A lack of funding is one of the main reasons businesses fail within the first few years of starting out. Entrepreneurs, who are just embarking on their journey, often fail to realize that there are many loan and grant options available to them in Indiana. In this article, we analyze and compare...

Indiana Small Business Loans and Grants
Tetiana Sitiugina
Financial Sector Specialist and Content Strategist

Currently, there are more than 451,000 small businesses in the state of Indiana. This economy employs about 1,6 million people, which is more than 99% of the private workforce. In Indiana, small businesses can get loans between $13,000 to $1.2 million, making it one of the best states for starting or owning a business.

Top Indiana Small Business Loan Options

Let’s begin by taking a closer look at some of the best small business loan options in Indiana:

1. Community First Bank of Indiana

Community First Bank of Indiana is dedicated to supporting local small businesses through a broad array of commercial loan products that meet diverse business needs. Some of the small business loan types offered by the Bank include:

  • Commercial term loans. With repayment terms between three and seven years, commercial term loans can be paramount to help your business meet its long-term financing needs. These loans come with either fixed or variable interest rates and can be used for equipment purchases, buy-outs of equity partners, and other business needs.
  • Commercial mortgages. Community First Bank of Indiana offers commercial mortgages ranging between 15 and 20 years, with a variety of interest rate options available.
  • Working capital lines of credit. Working capital lines of credit are reviewed annually and priced relatively to the prime lending rate. These loan options are ideal for seasonal businesses or businesses on a growth trend.
  • Commercial construction loans. The commercial construction loans offered by the bank are structured on a variable or fixed rate basis with interest-only payments.

2. 1st Source Bank

For more than 155 years, 1st Source, based out of South Bend, has provided clients with a friendly and convenient way to access financing. The bank is now the largest privately-owned financial institution in the region.

1st Source Bank has many finance options for small businesses and start-up companies, such as:

    • Term loans-1st Source Bank offers term loans that cover up to 100% of the item you are financing, with a repayment period of up to 10 years. You can use a term loan to finance anything from equipment and vehicles to working capital.
    • SBA loans-As an award-winning SBA Preferred Lender, this bank offers SBA loans ranging from $5,000 to $5 million. The repayment terms are generally longer than that of a traditional business loan. Plus, interest rates are capped and are typically more favorable than the average interest rates on the market.

    • Revolving lines of credit- 1st Source Bank also provides secured and unsecured revolving lines of credit. This is a suitable finance solution for short-term cash requirements, periodical credit demands, emergency funds, and purchase inventories.
    • Other types of financing-1st Source Bank also offers loans for specialty equipment, as well as agricultural loans.

3. German American

Small companies are critical to the economy and workforce in the U.S.A. German American Bank collaborates with the United States Small Business Administration (SBA) to provide financial assistance to new and emerging small businesses. SBA loans are federally guaranteed and have more flexible debt arrangements, longer repayment terms, and smaller down payment options.

Small business entrepreneurs commonly use 7A Loans as a main source of funding. This platform offers long-term funding to growing companies for a range of purposes, including working capital, commercial property, expansion, facilities, and inventory.

Small companies can get funding through 504 loans, which can help them expand and create jobs. This loan program encourages economic growth by providing long-term funding with fixed rates. The finances can be used for the purchase of fixed assets to increase or modernize your businesses.

4. Freedom Bank

As a locally owned and operated community bank, Freedom Bank serves Spencer, Dubois, and surrounding counties within Indiana. In addition to personal and business banking services, Freedom Bank offers an array of small business loans in Indiana, including:

  • Commercial real estate and building loans
  • Business acquisition loans
  • Machinery and equipment loans
  • Rental property loans
  • Construction loans
  • Seasonal operation loans
  • Agricultural loans
  • Lines of credit for inventory and receivables
  • Refinance and consolidation loans
  • Term notes for most business assets

While the bank doesn’t go into much detail about the terms and rates offered on different small business loan products, they are readily available to discuss your options over the phone

Top Online Indiana Small Business Loan Options

In addition to traditional lenders, such as commercial banks, online lending platforms often offer viable alternative options for small business financing.

1. Credibly - Best for SBA Loans


Credibly is a reliable online lender that has been offering financial products to Indiana-based small businesses for over 10 years. The company is dedicated to creating funding opportunities available to a broad range of customers. As such, its loans come with relatively lenient eligibility criteria, with a minimum credit score of only 500.

With Credibly, you can choose among seven different types of small business loans. One of the most popular types is a working capital loan, which works slightly differently from a typical term loan. Here, instead of paying a regular interest rate, you would need to pay a lump sum equal to a certain percentage of the total loan amount.

The Bottom Line

Other loan options offered by Credibly include lines of credit, business expansion loans, SBA loans, merchant cash advances, and more.

Try Credibly

Learn more about Credibly in our comprehensive review.

2. Biz2Credit - Best for Term Loans


Biz2Credit is a trusted online lender providing small business loans to entrepreneurs in Indiana and around the country since 2007. The company is known for its simple application process and quick turnaround times: you can expect to receive the funds within 72 hours of application.

Biz2Credit offers three main types of financing: term loans, commercial real estate loans, and working capital loans. While term loans are limited to $250,000, two other types of financing can help to fund much larger projects, with loan amounts ranging up to $6 million. The interest rates are also reasonable, starting at around 8.99% for all types of loans.

The Bottom Line

Keep in mind, however, that Biz2Credit’s eligibility requirements and minimum credit score can be tough to meet for startups and new businesses.

Try Biz2Credit

Learn more about Biz2Credit in our comprehensive review.

3. Fundbox - Best For Line of Credit


Fundbox is a fintech company and an online lender providing lines of credit and small business loans to entrepreneurs not only within the state of Indiana, but nationwide as well. With Fundbox, you will enjoy an easy and quick application process, as well as fast turnaround times. In addition, the company doesn’t require guarantees, has low minimum credit score requirements, and doesn’t charge any additional credit fees.

The Bottom Line

Applying for a business line of credit through Fundbox can provide you with flexible funds of up to $100,000. However, in order to qualify, you need to make sure that your business has been in operation for at least three months and has an annual revenue of at least $25,000. In addition, a minimum credit score of 500 is necessary.

Try Fundbox

Learn more about Fundbox in our comprehensive review.

4. Fundera - Best for Startup Loans


If you are looking for a personalized online term loan application experience, Fundera is the way to go. This online lender provides you with a personal advisor who will support you every step of the way.

In addition, Fundera is known for its relatively high maximum borrowing limits, ranging up to $600,000. However, loan collateral is usually required. The maximum repayment period is five years, with a fixed repayment structure. This means that you will be able to easily plan your company’s cash flow to accommodate loan repayments.

The Bottom Line

Another great thing about applying for a loan with Fundera is the fact that it demands less supporting documentation than traditional lenders, which speeds up the loan application and approval process considerably.

Try Fundera

Learn more about Fundera in our comprehensive review.

Additional Indiana Small Business Financial Resources

In this section, we discuss some other avenues and resources available to small business entrepreneurs in Indiana. 

LISC Small Business Relief Grants

LISC is a nationwide agency for small business funding that has both Indianapolis and national offices. The organization primarily provides investments for people from minority groups, women, and immigrant-owned companies in traditionally underprivileged areas. LISC Indianapolis has awarded 76 $5,000 grants to minority, refugee, and women-owned small companies.

Additional Small Business Guides

Here are guides and resources for opening a business in Indiana:

Learn how to market to the government of your state or municipality with these resources:

The online Indianapolis Public Library has a plethora of resources available. Here are a few of them:

Bottom Line

There are many unique and innovative business ideas out there, yet funding is often an issue that prevents businesses from reaching their goals. That’s why it’s important to look at all the financing options available to see which one will best help your business. From state grants and small business loans to business credit cards and collateral financing, there are numerous options available for any small businesses in Indiana. 

Of course, every option has its risks and advantages. You will have to weigh each loan type against each other to see which one will most help your business. If you have the right business plan and enough passion, you will find the funding you need to get your business off the ground.

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About the Author

Tetiana Sitiugina-Babiuk

Tetiana Sitiugina-Babiuk

Financial Sector Specialist and Content Strategist

Independent writer, content strategist, and financial sector specialist. Tatiana has an extensive experience in working with financial institutions such as Bank of Canada and Risk Management unit at FinDev Canada. She holds an MA in Financial Risk Management from the University of Toronto.

More about me