Microloans are available for small business owners or startups that have a thin credit file or can’t secure funds through a traditional bank. Microlenders are non-profit organizations that offer smaller loan sizes, which max out at $50,000 but tend to average much less than that. They charge slightly higher interest ratesthan big banks, but have less stringent underwriting criteria. Microlenders will typically mentor you through the application process, which is a big plus. Their goal is to help you build your credit and financial history, so that you can eventually qualify for bank funding.

  • Reasonable interest rates (8-18%)
  • Favorable repayment terms
  • Good way to establish business credit
  • Available for many uses
  • Collateral usually not required
Things to consider: 
  • Limited to businesses with 5 or fewer employees
  • Small loan amounts, average $6000
  • Extensive paperwork required
  • Past credit issues can still disqualify you
  • You may have to take a business training class
Credit Score Requirements: 
Annual Interest Rates: 
8% – 18%
Turnaround Time: 
1 – 3+ months

Loan amounts

Loan range: 
$500-$50 000