Compare funding options
Eight ways to fund a business on one table: typical cost, speed, term, what each needs and what it is best for. Categories, not companies. Ranges reflect what qualified applicants see in the current market; the terms that apply to you are only those in an agreement you sign.
| Option | Typical cost | Speed | Term | What it needs | Best for |
|---|---|---|---|---|---|
| Merchant cash advance | Factor 1.15–1.45 → roughly 40–150% APR-equivalent | 1–3 days | 3–12 months, daily or weekly remittance | 6+ months in business, bank statements, consistent deposits | A short, high-margin use that cannot wait on a bank; owners banks have declined |
| Revenue-based financing | Cap of 1.2–1.6× the amount | 3–7 days | 6–24 months, a fixed % of revenue | Recurring revenue, 12+ months, clean statements | Seasonal or fast-growing businesses whose payments should move with sales |
| Business line of credit (bank) | Prime + 1–5%, roughly 9–14% APR | 1–4 weeks | Revolving, annual review | 2+ years, 680+ FICO, financials | Recurring gaps; the cheapest flexible money a qualified business can hold |
| Online line of credit | Roughly 20–60% APR | 1–3 days | Revolving, 6–12 month draws | 6–12 months, 600+ FICO, statements | A credit line when the bank's timeline or minimums do not fit |
| Bank term loan | Roughly 8–14% APR | 2–8 weeks | 1–10 years, monthly | 2+ years, 680+ FICO, tax returns, often collateral | Planned investments with time to qualify; the lowest cost short of SBA |
| SBA 7(a) loan | Prime + 2.25–4.75%, roughly 10–14% APR | 30–90 days | 7–25 years, monthly | 2+ years, 680+ FICO, full package, personal guaranty | The largest, longest, cheapest capital a small business can reach, when the timeline allows |
| Equipment financing | Roughly 7–20% APR | 2–10 days | 2–7 years, monthly | The equipment quote, 1+ year, 600+ FICO | Buying equipment: the asset secures the deal, so it prices well below unsecured capital |
| Invoice factoring | 1–5% of the invoice per month outstanding | 1–3 days after setup | Per invoice, 30–90 days | B2B invoices to creditworthy customers | Businesses that wait 30–90 days to be paid by solid customers |
Costs are typical ranges for U.S. small businesses as of this page's update date, not offers. APR-equivalents for advances assume a daily remittance over the stated term; see the factor rate calculator for the arithmetic.
How to read the table
Is a merchant cash advance a loan?
No. An MCA is a purchase of a fixed amount of your future receivables at a discount: you receive a lump sum now and remit a set daily or weekly amount, or a percentage of card sales, until the purchased amount is delivered. Because it is not a loan there is no interest rate; the cost is the difference between what you receive and what you remit, expressed as a factor rate — and that factor rate is only comparable to a loan once it is converted to an APR-equivalent over the same term.
How do I compare a factor rate with an interest rate?
Convert both to dollars over the same months, then to APR. A $50,000 advance at 1.30 over six months costs $15,000 — about 109% APR-equivalent on a daily remittance. A bank term loan at 12% APR on the same $50,000 over six months costs about $1,770. The advance may still be the right tool for a short, high-margin use the bank will not fund in time; the point is to see both numbers before choosing.
When is a bank the better choice?
When it will say yes inside your timeline. Bank term loans and lines of credit cost a fraction of an advance; SBA 7(a) loans less again. If you have two years in business, a 680+ score and clean financials, start there. Alternatives earn their cost when the opportunity or the gap will not wait, or when a bank has already said no.
Ready to see what your numbers come back as?
One request, three months of statements, options from our network of funding partners in plain dollars — or an honest note that a bank is your better route.