7 Best Unsecured Business Loans for 2022

Last Updated on November 22, 2022 by Selina Parker

When looking for business financing, it’s essential to weigh your options and choose the best loan for your needs. Secured loans are a great option because they offer lower interest rates and are less risky for the lender.

But what if you don’t have any business assets to use as security? Don’t worry — there are plenty of unsecured business loans available!

What is an unsecured loan?

Small business loans generally need collateral, which may be business or personal, and can include real estate, equipment, savings, or other assets. You can use unsecured loans if you don’t have collateral to offer security for the loan or don’t want to put personal assets on the line.

Unsecured business loans work like traditional loans, only it doesn’t require security. If you can’t repay the loan, the lender can’t take your assets to cover the cost.

However, unsecured business loans may be more challenging to qualify for and have higher interest rates than secured business loans. Still, they pose less risk for lenders and small business owners.

7 Best Unsecured Business Loans

1. Fundbox

Best for everyday purchase

Maximum loan amount: $150,000

Minimum Credit Score: 600

Estimated APR: 10.10-79.80%

Best Features

• Offers $1000 to $150,000 unsecured business line of credit
• Funds may be available the next business day if you apply promptly.
• It requires only a simple application and minimal documents.
• Allows new businesses to borrow funds with a minimum of six months of operation, making it ideal for startups.
• The credit score requirement is low.

Drawbacks

• Higher interest rates compared to traditional banks
• A personal guarantee may be required.
• The most extended loan duration is 24 weeks or six months
• Fundbox levies a weekly charge on each amount drawn from the line of credit

2. BlueVine

Best for larger purchases

Maximum loan amount: $250, 000

Minimum Credit Score: 600

Estimated APR: 15.00-78.00%

Best Features

• Cash might be available in as little as 12 to 24 hours.
• Different term lengths are available for different funding needs.
• The credit score requirement is low.
• Allows new businesses to borrow funds with a minimum of six months of operation, making it ideal for startups.

Drawbacks

• It may require weekly repayment
• May require a personal guarantee
• Higher rates compared to traditional lenders

3. OnDeck

Best for bad credit

Maximum loan amount: $100,000

Minimum credit score: 600

Estimated APR: 11.00-61.90%

Best Features

• Cash is available within the same business day
• Low credit score requirement
• Lesser paperwork than others

Drawbacks

• Because of the fixed-fee structure, early repayment will not save interest.
• It may require weekly repayment
• A personal guarantee is required

4. Credibly

Best for bad credit

Maximum loan amount: $400,000

Minimum credit score: 500

Best Features

• Multiple unsecured loan offers are available, including working capital and merchant cash advances.
• Funding is generally available on the same day, with approval possible in 24 hours.

Drawbacks

• The business should have at least $15,000 in monthly bank deposits.
• You must be in business for at least six months for working capital loans.

5. Rapid Finance

Best for product availability

Maximum loan amount: $1 million

Minimum credit score: undisclosed

Best Features

• As quickly as one day, you can get a business loan.
• Multiple loan options are available.
• It might accept borrowers with a variety of credits.

Drawbacks

• Instead of an annual percentage rate, Rapid Finance provides loans with a monthly fee.

6. Biz2Credit

Best for loan options

Maximum loan amount: up to $5 million

Minimum credit score: 580

Best Features

• Provides access to a variety of financial institutions
• Matches borrowers to different loan

Drawbacks

• Only a platform rather not a direct lender
• Lending guidelines will vary

7. Kabbage

Best for bad credit

Maximum loan amount: $250,000

No minimum credit score requirement

Best Features

• Can fund your business within a few hours
• No minimum qualifying credit score requirement

Drawbacks

• Businesses must be generating $50,000 in annual revenue
• Loan fee of 1.5% to 10% each month

Why would I want an unsecured business loan?

Many offenders offer unsecured business loans, but why should you choose it over a secured business loan?

There are a few reasons you might consider:

• You don’t have any assets to use as collateral.
• You don’t want to use your assets as security.
• The loan amount is too small to require collateral.
• Your business is new and doesn’t have a track record yet.

Don’t wait any longer – apply today, and you could have the cash you need in as little as 12 to 24 hours.