Small business loans and financing

There are nine common kinds of small-business funding, and the biggest difference between them is how you pay the money back. Six are loans or credit; a merchant cash advance, invoice factoring and a purchase of receivables are sales of future revenue or invoices. Most show the range lenders and funders in our network quote for them. You don't have to choose before you apply: one application is matched against 75+ lenders.

Last updated September 28, 2026

Compare by what the money is for

One lump sum, repaid on a schedule

For a defined cost with a clear payback: a renovation, a vehicle, a large order, a second location.

Term loan
16% to 25%Rates lenders in our network quote^[1]
A term loan is a lump sum you repay in fixed installments over a set term, for a one-time cost with a clear payback.
Fixed payments on a set schedule until the balance is repaid.
SBA loan
7% to 18.99%Rates lenders in our network quote^[1]
An SBA loan is made by a lender and partly guaranteed by the U.S. Small Business Administration, usually with longer terms.^[6]
Regular payments spread over a longer schedule until the balance is repaid.
Equipment financing
8% to 30%Rates lenders in our network quote^[1]
Equipment financing pays for vehicles, machinery or other hard assets, and the equipment itself secures what you borrow.
Fixed payments on a set schedule, with the equipment itself as collateral.

Draw, repay, draw again

For the gaps between busy and slow, and the everyday costs that never arrive on a schedule.

Line of credit
2% to 5% a monthRates lenders in our network quote^[1]
A business line of credit lets you draw funds as you need them, up to a limit, and pay interest only on what you use.
Draw what you need up to a limit, repay it, and draw again.
Business credit card
A business credit card is revolving credit for everyday spending, billed each statement cycle, and can help build business credit.
Spending builds up over each statement cycle, and the balance is paid down when the statement is due.

Home equity line of creditSecured by your home

7% to 16.5%Rates lenders in our network quote^[1]

Lenders in our network also offer home equity lines of credit: a line of credit drawn against the equity in your home, which secures it.^[4]

Advances against sales and invoices

For businesses waiting on customers or card sales, where what you are owed is the strongest asset.

Three of these four are not loans. A merchant cash advance, invoice factoring and a purchase of receivables are sales of future revenue or invoices, usually priced as a factor or discount rather than an interest rate. A/R financing is a loan secured by your invoices. The figures below are pricing as quoted, so weigh offers by total cost, not against the loan rates above.^[5]

Merchant cash advance
20% to 60%Pricing as quoted in our network^[1]
A merchant cash advance is not a loan: a funder buys part of your future card or bank sales and collects a share of them.
Not a loan: its cost is quoted as a factor or discount, so compare offers by total cost.
A fixed share of your card or bank sales goes to the funder until the agreed amount is collected.
Invoice factoring
15% to 40%Pricing as quoted in our network^[1]
Invoice factoring means selling unpaid invoices to a factor for cash now, instead of waiting for customers to pay.
Not a loan: its cost is quoted as a factor or discount, so compare offers by total cost.
Most of an invoice is paid to you now, and the rest, less fees, when your customer pays.
A/R financing
15% to 40%Pricing as quoted in our network^[1]
Accounts receivable financing is borrowing against your outstanding invoices while you keep them and collect from customers.
How much you can draw rises and falls with the invoices you are owed.
Purchase of receivables
20% to 60%Pricing as quoted in our network^[1]
A purchase of receivables is not a loan: a funder buys a portion of your future receivables at a discount and collects them.
Not a loan: its cost is quoted as a factor or discount, so compare offers by total cost.
A funder buys a portion of your future receivables and collects that portion as they come in.

Which option fits which need

Start with what the money is for. The same need can often be met more than one way, and the best one depends on your business, how you're paid, and how soon you can repay.

Common uses of small-business funding, and the kinds of funding often used for each
What the money is for	Kinds of funding often used
Working capital	Line of credit Term loan Invoice factoring A/R financing Merchant cash advance Purchase of receivables Day-to-day costs, and the gap between paying out and getting paid.
Inventory	Line of credit Term loan Business credit card Stock you expect to sell, often bought ahead of a busy season.
Equipment	Equipment financing Term loan SBA loan Vehicles, machinery and tools, where the equipment can secure the financing.
Expansion	Term loan SBA loan Line of credit A new location, more staff or a new line of business, paid back over time.
Payroll	Line of credit Invoice factoring A/R financing Wages that are due before your customers pay you.
Marketing	Business credit card Line of credit Term loan Campaigns and ad spend, paid as you go or as one planned push.
Refinance debt	Term loan SBA loan Replacing existing debt with financing that suits your cash flow better.
Real estate	SBA loan Term loan Buying, building or improving the property your business runs from.

This is general guidance, not a rule. Each lender decides which products it offers and what they can be used for, and many businesses use more than one kind of funding.

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