When your firm has been operational for at least six months, you may qualify for a unsecured startup business line of credit (LOC), which is a revolving line of credit. You may take money out, spend it, pay it back, and get even more money out. Of course, locating creditors willing to provide lines of credit to new businesses may be challenging.

That's why we scoured the market to uncover the finest providers of lines of credit to startups and growing businesses. Lendio's marketplace makes it easy to compare credit line offers. Thus we advocate using it for most business owners. However, there were other excellent choices for a line of credit for a new business.

How To Get Credit For A New Business

You may have noticed that our suggested lenders are all "alternative" or "internet" lenders. Nevertheless, there is a logic behind this. Startups only have a few financing choices available from conventional lenders like banks. You must understand that banks have strict criteria for their borrowers and only extend loans to the most reliable borrowers.

It eliminates startups that are making little money. Thankfully, internet lenders have emerged to fill this need. Businesses with low income, poor credit, or just starting will find alternative lenders willing to cooperate with them. So, they are perfect for young businesses looking to raise capital.

Lendio

Lendio is a great place for startups to begin looking for a line of credit. The factors that made it the best in our rankings of small business loans also made it the best in these categories. Lendio simplifies the process of evaluating loan and LOC options, surprisingly.

Simply put, Lendio requires one LOC application before returning several quotes from different lenders. You may shop around for the best deal by looking at many lenders and selecting one that meets your needs in terms of interest rate, credit limit, etc.

BlueVine

When compared to the other lenders below, BlueVine has the best introductory rates. Its interest rates on credit lines start around 5%, which is exceptionally cheap for an Internet lender and competitive even among conventional financial institutions. This makes BlueVine credit lines a cheap way to get money.

Nevertheless, you shouldn't count on getting that meagre rate if you're a fledgling business. Yet, with more affordable rates to begin with, you might have a better chance of being approved for a loan without the backing of an established company's history.

Fundbox

How new is your company? Fundbox might be the lender you've been looking for. Lender preferences often favour companies having a minimum of one year in operation. There is the odd lender out there that will deal with startups, but they can't compare to Fundbox.

Fundbox prefers that enterprises have been operating for at least six months before applying, although it will consider those from as little as two months old.

There is a price to pay for that adaptability. Be sure you can afford the draw fees and the payback plan before signing up for a Fundbox line of credit. Your company's youth should allow you to apply for a line of credit. Fundbox will tell you.

OnDeck

Do you run your company with an eye towards the future? If so, you can get to know OnDeck. Also, it reports to credit agencies, so paying back your OnDeck line of credit might boost your credit score and make it easier to get future financing.

Like many other online lending platforms, OnDeck has high fees. If you're used to dealing with a standard bank, the initial annual percentage rate (APR) may shock you. Yet if OnDeck helps you get better financing in the future, you could decide it's money well spent.

Kabbage:

The daily or weekly payment schedules many internet lenders use can wreak havoc on a company's ability to bring in money. Kabbage, on the other hand, allows you to make monthly payments on all of its credit lines.

Kabbage's monthly fees may mount up quickly. Your payments will be more significant monthly, of course, but they will be lower if you make them more often. You'll love Kabbage if monthly payments work for you and your budget.

Bottom line

Lendio's marketplace allows you to compare different loan offers, making it the ideal location to get a line of credit for your firm. Other lenders, such as BlueVine for cheap rates, Fundbox for startups, OnDeck for better terms in the future, and Kabbage for monthly payments, may better suit your needs. We hope that your line of credit contributes to the success of your business.