American Express Business Loans: 2023 Review
Janet Schaaf is a freelance writer, editor and proofreader who considers reader advocacy to be her calling. After taking a few roads less traveled, Janet completed a bachelor’s degree in English Literature from the University of Missouri-Kansas City, with English Department Honors. She has been correcting grammar and checking facts since she could string a sentence together. For the past three years, Janet has focused on making personal finance topics understandable and relatable. Loan terms and credit card agreements can look overwhelming, but understanding what you’re agreeing to is paramount in grasping the impact debt can have on your life.
Pros and cons of American Express Business Loans
| Pros | Cons |
|---|---|
No prepayment, application or origination fees No collateral required Can be used to consolidate business debt (as long as it’s not an American Express account) | Must be American Express Business Card Member for at least one year Late payment or insufficient fund fees of $39 Cannot be used to pay off American Express credit card debt |
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American Express Business Loans review
American Express is a payments company best known for its suite of personal and business credit cards. The company also provides unsecured small business loans with fairly competitive interest rates. However, you must be an existing cardholder with a small business credit card in order to apply, and even still, American Express Business Loans may not always be open to new applicants.
Who are American Express Business Loans for?
- Existing Amex cardholders. Must have an American Express Business credit card for at least one year.
- Business owners looking to consolidate business debt. Can be used to consolidate existing business credit card debt not associated with American Express..
- Those who want a loan without a lot of fees. You only pay a fee if your payment is late or have insufficient funds.
American Express Business Loans at a glance
| Product | Loan amounts | Repayment term | Estimated APR range | Fees |
|---|---|---|---|---|
| Business term loan | $3,500 to $75,000 | 6 to 36 months | 6.98% to 19.97% | $39 late fee or fee for insufficient funds |
Term loans
American Express Business Loans are only available to pre-approved American Express Business Card Members. These short-term business loans can be used to help with funding for a small business or to consolidate existing business credit card debt. But, there’s one important catch: You cannot use this loan to consolidate debt from American Express credit cards.
Loan amounts are between $3,500 and $75,000 with repayment terms of 6, 12, 24 or 36 months. Annual percentage rates (APRs) for these business loans range from 6.98% to 19.97%. There are no application fees or prepayment penalties with the product, but if you are late to pay or don’t have enough funds, you’ll be hit with a $39 fee.
American Express Business Loan borrower requirements
| Minimum annual revenue | Not disclosed |
| Minimum time in business | Not disclosed |
| Minimum credit score | Not disclosed |
While American Express may look at your company’s income and revenue like most business lenders, it does have one unique restriction: In order to be eligible, you’ll need to be an existing American Express Business Card member without any negative payment history, and a U.S. citizen or resident who is 18 years of age or older.
When applying for an American Express Business Loan, you’ll need to provide a valid email address, along with the loan amount, preferred repayment term and the financial reason your small business needs the funds. Only once you’re approved, will American Express determine if you can borrow the amount requested and how high your business loan interest rates will be.
Required documents
It’s not clear what the required documents needed to get an American Express Business Loan are. But keep in mind, many lenders require documents that can include personal and business tax returns, bank and income statements and a business plan, among others.
Alternatives to American Express Business Loans
| American Express Business Loans | American Express Business Line of Credit | OnDeck | |
|---|---|---|---|
| Minimum credit score | Not disclosed | 660 | 625 |
| Loan products offered | Business term loan | Business line of credit |
|
| Time to funding | 3 to 5 business days | 1 to 3 business days | As soon as same business day |
| Starting APR | 6.98% |
| 35.40% |
| Maximum loan size | $75,000 | $250,000 |
|
| Minimum annual revenue | Not disclosed | $36,000 | $100,000 |
American Express Business Loans vs. American Express Business Line of Credit
In addition to its American Express Business Loan product, the company also offers the American Express Business Line of Credit. No Amex business credit card is required to apply for the business line of credit, making it a potentially more accessible funding option for small businesses in need of more funding. The minimum annual revenue requirement is also relatively low, making it easier for newer businesses, including startup businesses, who may not yet be bringing in a lot of income to apply. While the business loans product has a relatively transparent APR, the fee structure with the business line of credit product is a bit confusing.
American Express vs. OnDeck
OnDeck offers both term loans and lines of credit but at a much higher APR than American Express. However, OnDeck does not restrict eligibility to cardholders or customers already in its network. Plus, OnDeck’s time to funding is much quicker, so this may be a better option for small businesses looking for fast cash.