Best business lines of credit in 2025

Pros explained

• Fast funding: Some of the best business line of credit lenders offer approvals and funding within a business day. It’s relatively common to apply for funds and then be able to draw on your credit line in a short period of time. If you need access to fast capital, a business line of credit can help.
• No need to reapply: As long as you maintain an adequate available balance, you can continue to draw on your line of credit without the need to reapply for approval. This can help you continue to streamline your business finances.
• Flexibility: Funds are available for a variety of purposes, and you can usually draw on them as needed. 

Cons explained

• Rates might be higher: Often, a line of credit comes with higher costs. Lenders often charge higher rates for unsecured lines of credit than they do for other types of debt, like low-interest term loans.
• More frequent payments: Depending on the lender, you might need to make frequent payments. Some business lenders require weekly payments rather than monthly payments. For some businesses, weekly payments might be too frequent for cash flow.

How to compare the business lines of credit

As you compare business lines of credit, consider the cash flow requirements of your business. Consider comparing three to five lenders and choose one that meets your needs.

What matters most—rates or speed?

Compare the cost of the loan. This can be difficult, depending on whether the lender uses a factor rate or an interest rate. Make sure you’re comparing similar rates. Another consideration is that some lenders charge an interest rate over shorter time periods. For example, Fundbox charges 4.66% for a 12-week repayment term. 

Converting rates to annual percentage rates (APRs) can help you determine the costs

Compare costs, but also think about speed. If you need fast funding to smooth your business cash flow, it might be worth paying a little more to receive money within one business day. On the other hand, if you don’t need capital immediately, you might be able to avoid paying higher business line of credit rates and get a lower-cost loan.

Business requirements to qualify for a small business credit line

Business line of credit lenders generally require you to share information about your business and meet certain criteria. Generally, you need to be in business for a minimal amount of time, often at least six to 12 months. Additionally, you need to provide monthly or annual revenue, such as being on track to generate at least $100,000 a year.

Depending on your business, it might make sense to compare lender requirements to qualify for a line of credit. Find out how much you qualify for and whether you meet the criteria, so you know which lenders to prioritize.

How to maximize your unsecured business line of credit

If you want to improve your chances of being approved for a business line of credit—and maximize the amount you qualify for—consider the following tips:

• Improve your personal credit: Many small business lenders check your personal credit and might require a personal guarantee, meaning they hold you personally liable for your business debt. Often, you must meet minimum credit requirements to qualify.
• Gather documentation: If you don’t have accurate business information, you’re more likely to be rejected for a business line of credit. You might need to provide your articles of incorporation and you often need an employer identification number (EIN) from the IRS. Make sure you have good business bank account records as well.
• Find out whether the lender reports to business credit bureaus: If you’re a relatively new business, you might be able to use the business line of credit to create a credit history for your business. If you can build business credit, you might be able to qualify for more conventional business loans later.

Alternatives to a business line of credit

A business line of credit isn’t your only option if you’re trying to fund your business. 

• Small business credit card: You might be able to qualify for a business credit card. If you don’t need as much credit, but you want a revolving line of credit, a credit card might be a good choice. 
• SBA loan: If you’ve been in business for a longer period of time, and you meet the requirements, an SBA loan might be a low-cost alternative to a business line of credit. However, you will have a regular repayment schedule and there might be less flexibility.
• Personal loan: Your personal credit might qualify you for an unsecured loan that can be used to cover your business costs.
• Crowdfunding: There are crowdfunding sites designed to help small businesses raise money.
• Friends and family: Consider whether your network might be willing to lend you money at a low or no interest rate.

Methodology

We evaluated 13 online small business lenders, focusing on key areas such as affordability, loan options, underwriting requirements and customer experience. Our top business line of credit lenders are a subset of our best small business lenders—the top lenders providing business lines of credit. Advertisers and partners don’t influence our ratings, as our research and editorial team maintains independence in using data-driven methodologies.

Learn more about how Buy Side rates the best small business loans.

FAQ

When is a secured line better than an unsecured option?

A secured line might qualify you for a higher loan amount if your collateral is valuable enough. Additionally, a secured line might have a lower cost than an unsecured line.

How much can I expect to borrow as a new business?

Your borrowing amount depends on your business revenue, personal credit and how your business fits into lender criteria. You might be able to borrow between $500 and $500,000—or more. Some startups can borrow up to $50,000 with the SBA microloan program if they meet the requirements.

Are business line of credit rates fixed or variable?

A business line of credit can have either a fixed or variable rate. Check with your lender to review the cost and determine if there’s a draw fee that adds to the overall cost of your loan.

How does usage affect my business credit?

Whether a business line of credit impacts your business credit depends on whether the lender reports to a business credit bureau like Dun and Bradstreet or Experian. Some lenders don’t report to a business credit bureau, so if you want to build your business credit, look for a business line of credit lender that reports your payment history.