Best Business Lines of Credit for New Businesses in 2025
Compare lenders that offer funding to businesses in their first one or two years.
| Lender | Starting rate | Amount | Term | Time in business | |
|---|---|---|---|---|---|
|
Not specified | Up to $250k | 12 – 60 months | None | |
|
4.66% | Up to $250k | 3 – 6 months | 3 months | |
|
Not specified | Starting at $1k | Up to 12 months | 6 months | |
|
Not specified | $10k – $1M | 6 – 18 months | 6 months | |
|
9.50% | Up to $10M | 24 – 120 months | 6 months | |
|
39.60% | $6k – $200k | 12 – 24 months | 12 months | |
|
3.00% | $2k – $250k | 6 – 24 months | 12 months |
Best business lines of credit lenders: More details
Best for: Business line of credit for long-term funding – Truist
- No minimum time in business requirement
- No minimum annual revenue requirement
- Longer repayment terms than many of the lenders on this list
- Lines of credit over $100,000 require collateral to secure
- Origination fee of 0.50% or $100, whichever is greater
- Secured lines may require additional fees
Businesses seeking long-term, revolving funding may want to consider a secured line of credit from Truist, which can provide up to $250,000.00 with terms lasting as long as 60. This is a particularly long repayment period, giving you plenty of time to borrow funds as needed to grow your business. The best part is you’ll only pay interest on what you borrow.
With no minimum time in business or annual revenue requirements, Truist may be a great option for startups. However, lines of credit over $100,000 will require collateral to secure.
In order to qualify, you’ll need to meet Truist’s criteria of:
- Minimum credit score: Not specified
- Minimum time in business: None, though additional paperwork may be required for businesses that have been in operation for less than two years
- Minimum annual revenue: None
Best for: Business line of credit for low interest rates – Fundbox
- Low starting interest rates
- Next-day funding available
- Low time in business and annual revenue requirements
- Shorter repayment terms increase the cost per payment
- Max credit line is relatively low compared to other lenders
With starting rates that are lower than most competitors, a line of credit from Fundbox might be a good option if you need to keep interest costs low. Rates start at 4.66% for 3 terms and 8.99% for 6 terms. This short-term financing can provide up to $250,000.00 to be used for startup costs including purchasing equipment, hiring staff and covering gaps in your cash flow. And as a bonus, Fundbox may give you access to funds as soon as the next day.
With relatively low time in business and annual revenue requirements, businesses may be able to qualify after only 3 months in operation. However, it’s important to note that weekly payments will be required.
In order to qualify, you’ll need to meet Fundbox’s criteria of:
- Minimum credit score: 600
- Minimum time in business: 3 months
- Minimum annual revenue: $30,000
Best for: Business line of credit for building credit – Bank of America
- Low annual revenue requirement
- Short time in business requirement
- Likely easier to qualify for than other business lines of credit
- Requires a cash deposit to open
- Available funding is determined by the size of your security deposit
- Minimum credit score is not disclosed
If your business is new and you need help building your business credit, consider Bank of America.
As a secured financial product, Bank of America’s Cash Secured Line of Credit is different from other business lines of credit. A security deposit of $1,000.00 or more will be required to open the account. Much like with a secured business credit card, the amount you deposit will determine the amount you have to spend. As you make payments, Bank of America will report back to the major credit bureaus, building credit for your business.
After 12 of consistent payments, borrowers may be eligible to have their deposit refunded and upgrade to an unsecured line. However, because the funding you can access for the first year will be limited to what you can afford to put down, this option is less flexible than some of the others on this list.
In order to qualify, you’ll need to meet Bank of America’s criteria of:
- Minimum credit score: Not specified
- Minimum time in business: 6 months
- Minimum annual revenue: $50,000
Best for: Business line of credit for low credit borrowers – Taycor Financial
- High borrowing amounts
- Low credit score requirement
- No tax returns required for transactions up to $400,000
- Origination fee of up to 3.00%
- High annual revenue requirement
- Requires a personal guarantee
If you have less-than-stellar credit, finding financing for your new business can be a challenge. But with Taycor Financial, borrowers with scores as low as 560 may be able to qualify for a line of credit up to $1,000,000.00, making it easier for low-credit borrowers to qualify for financing. And with an impressively high borrowing amount, business owners can rest easy knowing their business is covered if any unexpected expenses pop up.
However, a business line of credit from Taycor Financial will require a personal guarantee, which can put your personal financial standing at risk if your business fails to make payments. For this reason, it’s important to make sure you can afford your monthly payments before withdrawing any funds.
In order to qualify, you’ll need to meet Taycor Financial’s criteria of:
- Minimum credit score: 560
- Minimum time in business: 6 months
- Minimum annual revenue: $50,004
Best for: Government-backed business line of credit – Fundible
- Large loan amounts can be used for a variety of business purposes
- Lower credit score, time in business and annual revenue requirements than other SBA lenders
- No prepayment penalties
- Not an SBA Preferred Lender, so funding may take several months
- May require a down payment
- Collateral and/or personal guarantee may be required
Lines of credit backed by the U.S. Small Business Administration (SBA) have several benefits, including high borrowing amounts, lengthy repayment terms and capped interest rates. But getting a government-backed loan can be tricky for new businesses, as SBA lenders typically require a good credit score and a minimum of two years in business to qualify.
With Fundible, it may be easier to secure an SBA line of credit, with the lender offering financing to companies after only six months in business. However, this may not be the best option for borrowers with urgent needs, as it may take several months to receive your funds.
Learn more about Fundible.
In order to qualify, you’ll need to meet Fundible’s criteria of:
- Minimum credit score: 500
- Minimum time in business: 6 months
- Minimum annual revenue: $96,000
Best for: Business line of credit for same-day funding – OnDeck
- Same-day funding available
- Fair to low credit accepted
- Flexible repayment schedules, including weekly and monthly options
- High interest rates
- Lowest funding cap on this list
OnDeck’s ability to provide same-day funding sets it apart from the competition, allowing borrowers to receive their funds without delay. Though the lender’s borrowing requirements aren’t quite as lenient as some of the others on this list, businesses that have been in operation for at least one year may be able to qualify.
However, qualifying borrowers will pay a price for their fast funds, as OnDeck’s interest rates are fairly high.
In order to qualify, you’ll need to meet OnDeck’s criteria of:
- Minimum credit score: 625
- Minimum time in business: 12 months
- Minimum annual revenue: $100,000
Best for: Business line of credit for short-term funding – American Express
- Fast application process
- No application, origination or prepayment fees
- Funding available in 1 to 3 business days
- Higher minimum credit score than other lenders on this list
- Requires a personal guarantee
- Only select customers can qualify for financing over $150,000
If you’re looking for short-term financing, look no further than American Express’ business line of credit, which can provide up to $250,000.00 with repayment terms lasting 6, 12, 18 or 24. Unlike other short-term loan options, this line of credit does not require weekly payments. This means a 6-month term from American Express might be a better option for borrowers with short-term needs.
With no application, origination or prepayment fees, American Express keeps the upfront costs of borrowing low and you won’t be penalized if you choose to pay off your loan early. Still, with a minimum credit score of 660, this line of credit may only be an option for those with good credit scores. In addition, American Express requires a personal guarantee, which means you’ll be expected to repay the loan if your business is unable to foot the bill.
In order to qualify, you’ll need to meet American Express’ criteria of:
- Minimum credit score: 660
- Minimum time in business: 12 months
- Minimum annual revenue: $36,000
What is a business line of credit?
A business line of credit is a flexible form of small business funding. Unlike a term loan, which disburses the money in one lump-sum payment, a business line of credit typically works more like a credit card.
Because they provide revolving funds, business lines of credit offer greater flexibility than business loans, allowing you to borrow funds as needed up to a certain limit. You’ll only pay interest on the amount that you’ve borrowed, and you can borrow against your limit again once you’ve paid down your balance.
Most financial institutions require you to be in business for at least two years before extending you a line of credit. However, our picks for the best business line of credit for new businesses have shorter time in business requirements.
Types of business lines of credit for new businesses
As a new business owner, there are two types of business lines of credit that you may want to consider.
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Secured lines of credit
Secured lines of credit are backed by collateral. Since the lender has an asset that they can repossess if you default on the loan, these lines of credit are often easier to qualify for than their unsecured counterparts. -
Unsecured lines of credit
In contrast, unsecured lines of credit are not backed by a form of collateral. Since they are often seen as riskier for the lender, you’ll often need a better credit score to qualify. You may also be subject to higher interest rates.
Time in business requirements
In addition to annual revenue and credit score requirements, lenders typically enforce a time in business requirement, which dictates how long businesses must be in operation before they can qualify for financing.
Time in business requirements can create a challenge for new ventures. Traditional lenders often require businesses to operate for two years before they will consider lending to them, and even alternative lenders may prefer to work with businesses who have been in operation for six months to a year.
For this reason, brand-new startups may need to explore alternative financing options, such as crowdfunding or a personal loan, to start their business. As the business matures and generates revenue, it will become more attractive to lenders, making it easier to qualify for financing in the future.
However, with the lenders on this list, businesses may be able to secure a business line of credit after just a few months in business. For example, Truist sets no minimum time in business requirement for its line of credit, making it an ideal choice for new companies.
Other qualification criteria
While every lender sets its own loan requirements, you will typically need to meet the following criteria to qualify for a small business loan or line of credit:
Credit score
Small business financing is always subject to credit approval. Lenders use your credit score to determine your riskiness as a borrower. Most lenders require a score in the mid-600s or higher to qualify, though some lenders may be open to working with borrowers with scores as low as 500.
Annual revenue
Lenders want to know that your business has sufficient cash flow to repay your loan. That’s why they set annual revenue requirements, with many lenders requiring businesses to make at least $100,000 per year to qualify.
Time in business
As we mentioned, many traditional lenders require companies to be in business for at least two years to qualify for financing. However, online lenders may be more willing to work with newer businesses.
Collateral
Some lenders may require collateral to secure business financing. Collateral is an asset your lender can legally seize if you fail to make payments. Business assets such as real estate and equipment are often accepted as collateral.
How to get a business line of credit for a new business
Here’s a closer look at how to get a business line of credit:
1. Determine why you’re borrowing and how much you’ll need
Determining why you need the loan and how much you’d like to borrow will be essential in helping you find the right lender.
If you’re not sure how much working capital you need, our business loan calculator can help you get an estimate.
2. Evaluate eligibility criteria
Checking your credit score can go a long way toward helping you figure out where to apply for a loan. If your score needs some work, consider working to build your credit score before applying or looking for lenders who can accommodate lower scores.
Traditionally, online lenders offer more flexible qualifying requirements than brick-and-mortar financial institutions. However, in exchange you may end up with less flexible terms or a higher interest rate.
Similarly, secured lines of credit may also be easier to qualify for, but you’ll have to use an asset, such as inventory or a cash deposit, to back the loan.
3. Research appropriate lenders
Once you know what’s within your reach, the next step is to research lenders who may be a good match for your needs. Consider how much you can get with each lender and how long you’ll be given to repay your debt.
If you’re a new business, you’ll need to make sure you meet the lender’s minimum requirements to qualify for a line of credit. It may help to read some business lender reviews before moving forward with your application.
4. Gather your supporting documentation
Each lender’s required documents will vary. But in general, you can expect to provide a business plan, current financial statements and business tax returns. In some cases, you may also need to connect to a business checking account.
5. Apply for the line of credit
Many applications can be completed online, but in some instances, you may need to visit a physical branch location to apply for a business line of credit.
Decision time and funding timelines can also vary, but the lender will likely make these details clear so that you have a better idea of what to expect.
How to compare business lines of credit for new businesses
If you’re a new business, it’s a good idea to shop around for a business line of credit. Doing so can help you find a financial product you can afford that meets your short- and long-term needs. Here’s what you should compare while shopping.
Rates: Business loan interest rates can vary by lender and are typically based largely on your creditworthiness. Some lenders may charge a factor rate instead of simple interest.
Added fees: Be sure to ask each lender about the fees they charge. Small business lines of credit often come with draw fees, annual fees or monthly maintenance fees, which can add up over time.
Repayment terms: Monthly or weekly repayment may be available for a business line of credit. Take the time to make sure you can afford to make the repayments on time to avoid default.
Credit limit: Credit limits can also vary by lender. Do your best to choose a lender who offers enough funding to meet your needs.
Funding time: Some lenders are able to deposit funds into your account the very same day your application is approved. Others may require a few days or up to several months.
Pros and cons of lines of credit for new businesses
Pros
- Can withdraw money as needed
- Only pay interest on the amount you borrow
- Typically has lower interest rates and higher borrowing limits than a credit card
Cons
- Not the best pick for financing large purchases or ongoing business expenses
- May need to secure your financing with collateral
- Additional fees can increase the total cost of borrowing
Alternatives to business lines of credit for new businesses
If you decide that a business line of credit isn’t the right fit for your new business, don’t worry. There are other options, including:
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Business credit cards
Business credit cards tend to have lower borrowing limits and higher interest rates than business lines of credit, but if you can afford to pay off your balance in full every month, you may be able to leverage rewards you can’t get with a line of credit. -
Personal loans
If you have a decent personal credit score, you may be able to use a personal loan to fund your business’s needs. Just remember that you’ll be on the hook for repayment, and your personal financial profile will take a hit if you default. -
Personal lines of credit
If you’re looking for flexible, revolving funding that is more affordable than a credit card, consider a personal line of credit. This functions similarly to a business line of credit, though eligibility will depend on your personal credit history. And like a personal loan, it can affect your personal credit score and finances. -
Crowdfunding
This involves collecting donations from friends, family and your business community. If you’re struggling to qualify for traditional forms of financing, crowdfunding could provide the funding you need, though your chances of success will be higher if you have a strong social media following.
Frequently asked questions
It is possible to get a business line of credit as a new business. Though most traditional lenders require a minimum of two years in business to qualify for financing, the lenders on this list may be willing to work with companies that have been in operation for a year or less.
Most banks require you to have at least a two-year business history before applying for a line of credit. However, some banks have more lenient qualifying requirements. For example, Fundbox only requires you to have three months in business.
The process for getting a business credit card as a startup often involves registering your business, obtaining an EIN number and applying for a card that suits your needs.
Our methodology: How we chose the best business lines of credit for new businesses
We reviewed more than 15 lenders to determine the best business lines of credit for new businesses. To make our list, lenders must meet the following criteria:
- Minimum time in business of one year or less.
- Rates and terms: We prioritize lenders with more competitive fixed rates, fewer fees and greater options for repayment terms, loan amounts and APR discounts.
- Repayment experience: We consider each lender’s reputation and business practices. We also favor lenders that report to all major credit bureaus, offer reliable customer service and provide any unique perks to customers, like free wealth coaching.