Fundbox 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.
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Pros and cons of Fundbox
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Fundbox small business loans review
Fundbox is an online lender that’s been around since 2013. Its only business loan product is a business line of credit with a $150,000 max credit line. Fundbox is available in all 50 states and many U.S. territories, though there are some specific industries that are off-limits.
Credit score requirements are quite low, which can make them a good option for business owners with bad credit — especially those who need funding quickly. But if you don’t have an ideal credit score, you shouldn’t expect to secure Fundbox’s lowest rates.
Who is Fundbox for?
- Business owners with lower borrowing needs. Fundbox’s business line of credit only goes up to $150,000. But if you’re just looking to cover short-term expenses like payroll or inventory, it may fit the bill.
- Business owners with less-than-perfect credit. Minimum credit score requirements are only 600. But, Fundbox will do a deep dive into your banking statements and accounting software data to determine if you can afford repayment.
- Businesses that need fast funding. The underwriting process at Fundbox works at lightning speed. If you qualify, you could get approved within minutes and receive funding as soon as the next day.
Fundbox small business financing at a glance
| Product | Loan amounts | Repayment term | Starting interest rate | Fees |
|---|---|---|---|---|
| Fundbox business line of credit | Up to $150,000 | 3 or 12 months |
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| Fundbox Plus | Up to $150,000 | 3, 6 or 6 months | 20% lower than standard business lines of credit | $99 monthly fee |
Business line of credit
If you qualify for a Fundbox business line of credit, you can borrow up to $150,000. After you use your line of credit, you can repay it over a term of either 12 or 24 weeks. The first payment is due 14 days after the draw. Weekly fees start at 4.66% for 12-week terms. Twenty-four-week terms come with weekly fees starting at 8.99%.
Your weekly payments will be the same amount each and every time, and the weekly fees are amortized. That means in week one, you’d be paying more in business loan interest and less towards the principal balance compared to the last week of your repayment term, when you’d be paying less interest and more towards the principal. Regardless of the sliding scale of fees versus principal, the total amount due every week is static.
It’s hard to rack up late fees on a Fundbox line of credit because payments are automatically debited from your business checking account. But, if you are late on a payment, you will face a late fee. The late fee will be equal to your average weekly fee as if it weren’t amortized. So if you were paying a total of $600 in weekly fees over a 12-week term, you could expect your late fee to be $50 for each weekly payment missed. Plus, if your payment didn’t go through due to non-sufficient funds in your checking account, you’ll pay an additional $6 fee.
Fundbox Plus line of credit
The Fundbox Plus line of credit is less of a separate product, and more of a membership discount. You’ll be able to borrow the same max of $150,000, but you pay $99 every month for the privilege of more advantageous repayment terms through Fundbox Plus.
You can still repay your short-term business financing over 12– or 24-week terms if you so choose, but you also have the option of a longer 52-week term. With Fundbox Plus, you can choose whether you want to make payments weekly or monthly. And, repayment doesn’t start until 28 days after the draw on your line of credit. Regardless of the term you select, you’ll get a 20% discount on your weekly fees, which can be worth the $99 Fundbox Plus fee if the sum you borrow is large enough.
Fundbox Plus is in beta, and has been for a while. It’s only available to select existing Fundbox borrowers, so it’s not necessarily an offer you can bank on when you initially fill out your Fundbox application.
Fundbox borrower requirements
| Product | Loan amounts |
|---|---|
| Minimum annual revenue | $100,000 |
| Minimum time in business | 6 months |
| Minimum credit score | 600 |
To get a business line of credit at Fundbox, you must have a credit score of at least 600, and your business must be based in the U.S. You must have been in business for at least six months, with annual revenue of $100,000 or more. While Fundbox will only do a soft pull on your credit during the approval process, when you make your first draw it will do a hard pull. The application process is quick, and you can get funding as soon as the next day.
Fundbox lines of credit are available in all 50 states, plus Guam, Puerto Rico, American Samoa, the U.S. Virgin Islands and the Northern Mariana Islands, but you can’t get them for all industries. The following industries are prohibited:
- Adult entertainment and services
- Firearms or ammunition sales
- Online gaming and gambling
- Any marijuana-related businesses where you directly touch the plant
- Money service businesses
- Financial institutions
- Nonprofits
Required documents
When you apply for a Fundbox line of credit, you’ll be asked for some basic information about your business, like the time in business, annual revenue and so on. You may also be asked to connect your checking account and accounting software for underwriting purposes. The data found in these accounts will help Fundbox assess your creditworthiness. Other required documents may include the past three months of bank statements or past tax returns.
Alternatives to Fundbox
| Fundbox | OnDeck | Bluevine | |
|---|---|---|---|
| Minimum credit score | 600 | 625 | 625 |
| Loan products offered | Lines of credit |
| Lines of credit |
| Starting interest |
| Average rates of 52.0% APR for term loans and 52.6% APR on lines of credit, though it can be lower* | 6.20% simple interest for a 26-month term |
| Maximum loan size | $150,000 |
| $250,000 |
| Minimum annual revenue | $100,000 | $100,000 | $480,000 |
| Minimum time in business | 6 months | 12 months | 24 months |
*Average APRs for each loan product are based on loans originated in the half-year ending March 31, 2023.
Fundbox vs. OnDeck
First thing’s first: OnDeck is an incredibly expensive way to borrow. Even if you convert Fundbox’s weekly fees into APR, the starting rate is more than 40 percentage points below OnDeck’s average APR. One big pro of OnDeck compared to Fundbox is that OnDeck provides more lending solutions for small businesses. You can get either a line of credit or a term loan through OnDeck.
However, if it’s a line of credit you’re after, OnDeck’s maximum credit line is $50,000 less than what you’ll find at Fundbox. The annual revenue requirements are identical at both lenders, but you’ll need an entire year of business history to qualify with OnDeck, which is twice as long as the requirement at Fundbox. The minimum credit score requirement is also 25 points higher with OnDeck.
Fundbox vs. Bluevine
Like Fundbox, Bluevine only provides lines of credit. While you can borrow $100,000 more from Bluevine, you’ll also have to earn a lot more to qualify — $480,000 per year versus the $100,000 annual revenue requirement at Fundbox. Plus, you’ll need to have two years of business history to qualify at Bluevine, and the minimum credit score required is 25 points higher. Bluevine’s rates start a little lower than Fundbox’s, with slightly longer repayment terms.