Funding · Alternative
Alternative Business Loans
Alternative business loans are non-bank funding products — revenue-based financing, merchant cash advances, invoice factoring, equipment financing, and online lines of credit. They fund in days instead of months, weight monthly revenue over personal FICO, and cover the situations banks and SBA lenders won't touch: newer businesses, credit blemishes, seasonal cash flow, or projects that need cash this week. You trade a higher cost for speed and access. Below is a side-by-side comparison of the main options, what each is best for, and how to qualify.
Alternative loan options at a glance
| Alternative loan type | Typical FICO floor | Funding speed | Cost range | Best for |
|---|---|---|---|---|
| Revenue-based financing | 550+ | 1–3 days | 1.15–1.45 factor | Consistent monthly revenue, credit issues |
| Merchant cash advance | 500+ | 24–48 hours | 1.20–1.50 factor | Card-heavy sales, fastest cash |
| Equipment financing | 600+ | 2–7 days | 8–30% APR | Trucks, machinery, gear (collateralized) |
| Invoice factoring | No minimum | 1–5 days | 1–5% per 30 days | B2B with unpaid invoices |
| Business line of credit | 600+ | 1–7 days | 10–60% APR | Recurring cash-flow gaps |
| Short-term term loan | 580+ | 1–5 days | 10–50% APR | Defined project or expansion |
| Traditional bank / SBA (reference) | 680+ | 30–90 days | 6–13% APR | Strong credit, patient timeline |
When alternative wins
- • You need funding in under a week.
- • Personal credit is under 680 or thin.
- • Business is under 2 years old.
- • Revenue is strong but variable (seasonal, project-based).
- • You've been declined by a bank or SBA lender.
When to stick with a bank or SBA loan
- • FICO 700+ and 2+ years of tax returns.
- • You can wait 30–90 days for closing.
- • The amount is large ($250K+) and the use case supports a long amortization.
- • Real estate or major equipment is involved.
Path to cheaper capital
Many owners start with revenue-based financing or an MCA to solve today's cash need, then use the payment history to refinance into a line of credit or SBA loan 6–12 months later. Treat the first deal as the bridge, not the destination.
How it works
How BizKred works
A cleaner application-to-lender workflow for small-business funding.
Apply in minutes
Complete one simple intake with your business details, owner information, funding need, and recent bank statements.
We match you to lenders
BizKred reviews your profile and routes it to third-party lenders or funding partners whose programs may fit your business.
Compare available options
If lenders return offers, you review the terms and choose whether any option works for your business.
BizKred is your broker through the process — we connect, support, and guide. We do not make the final credit decision.
Funding by industry
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Frequently asked questions
What counts as an alternative business loan?
Any non-bank funding product — revenue-based financing, merchant cash advances, invoice factoring, equipment financing, online term loans, and non-bank lines of credit. They trade higher cost for speed, flexibility, and looser credit requirements.
Are alternative business loans more expensive than bank loans?
Usually yes. Expect 15–50% APR (or 1.15–1.50 factor rates) vs. 6–13% APR at a bank. You're paying for speed, easier qualification, and no collateral requirements.
Can I qualify with bad credit?
Yes for revenue-based financing, MCAs, invoice factoring, and equipment financing. Personal FICO in the 500s is workable if monthly revenue is $10K+ and bank statements are clean.
How fast can I get funded?
Merchant cash advances and revenue-based financing can fund in 24–48 hours. Equipment financing and invoice factoring typically take 2–7 days.
What documents do I need?
Three to six months of business bank statements, a driver's license, a voided check, and an EIN. Larger deals may add tax returns, a debt schedule, or A/R aging reports.
Related reading
Business Funding Options: A 2026 Guide for Owners
Compare the main small business funding options in 2026 — term loans, lines of credit, SBA, equipment financing, and revenue-based advances.
Read guideBusiness Loans for Bad Credit: What's Actually Available
Business loan options when your credit score is low — what lenders will look at instead, realistic terms, and how to improve your odds of approval.
Read guideBusiness Loan vs Line of Credit: Which to Choose?
When a term loan beats a line of credit and vice versa — costs, flexibility, and typical use cases for small business owners in 2026.
Read guideBusiness Line of Credit for Bad Credit (2026 Options & Rates)
Business lines of credit for bad credit — revenue-based, secured, and credit-builder options that fund with FICOs in the 500s. Compare rates, limits, and qualification.
Read guideReady to get your BizKred?
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