See your funding options side by side
One table covering eight ways to fund a business, with the typical cost, speed, term, requirements and best use of each. Categories, not companies. The ranges show what qualified applicants are seeing in today's market, and the only terms that apply to you are the ones in an agreement you sign.
| Option | Typical cost | Speed | Term | What it needs | When it fits |
|---|---|---|---|---|---|
| Merchant cash advance | Factor 1.15–1.45 → roughly 40–150% APR-equivalent | 1–3 days | 3–12 months, daily or weekly remittance | At least 6 months operating, bank statements and steady deposits | A quick, high-margin need that can't sit through a bank's timeline; owners who have already been turned down by a bank |
| 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 | Businesses that are seasonal or growing fast and need payments that rise and fall with sales |
| Credit lines for businesses (bank) | Prime + 1–5%, roughly 9–14% APR | 1–4 weeks | Revolving, annual review | 2+ years, 680+ FICO, financials | For gaps that keep coming back; the cheapest flexible money a business that qualifies can keep on hand |
| Online line of credit | Roughly 20–60% APR | 1–3 days | Revolving, 6–12 month draws | 6–12 months, 600+ FICO, statements | A line of credit for when a bank's minimums or schedule won't work |
| Bank term loan | Roughly 8–14% APR | 2–8 weeks | 1–10 years, monthly | Two or more years in business, FICO of 680+, tax returns, collateral in many cases | Planned spending when you can wait to qualify; the lowest cost outside of SBA |
| SBA 7(a) loans | Prime + 2.25–4.75%, roughly 10–14% APR | 30–90 days | 7–25 years, monthly | A complete package, a personal guaranty, a 680+ FICO and 2+ years | The biggest, longest-term and cheapest capital within a small business's reach, if the timeline allows |
| Equipment financing | Roughly 7–20% APR | 2–10 days | 2–7 years, monthly | The equipment quote, 1+ year, 600+ FICO | Equipment purchases: since the asset itself backs the deal, pricing comes in far under 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 with reliable customers who take 30–90 days to pay |
The costs shown are not offers but typical ranges for small businesses in the U.S. as of the date this page was updated. For advances, APR-equivalents assume daily remittances across the stated term; the factor rate calculator shows the math.
Two options at a time
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. There is no interest rate because this is not a loan; what you pay is the gap between the amount you remit and the amount you receive, stated as a factor rate, and you can only set that factor rate against a loan after converting it to an APR-equivalent over the same term.
What's the right way to compare a factor rate and an interest rate?
Put both into dollars across the same number of months, and then work out the APR. A $50,000 advance priced at 1.30 for six months carries a $15,000 cost, roughly 109% APR-equivalent with daily remittance. Borrowing the same $50,000 for six months on a bank term loan at 12% APR would cost roughly $1,770. An advance can still be the right choice when a bank won't fund a short, high-margin need in time, as long as you look at both numbers before you pick.
When is a bank the better choice?
Whenever it can say yes in the time you have. An advance costs many times what a bank term loan or line of credit does, and an SBA 7(a) loans costs even less than those. Owners with two years in business, a score of 680 or higher and clean financials should start there. The extra cost of alternatives is worth it when an opportunity or a gap can't wait, or when a bank has already turned you down.
Want to see how your own numbers come out?
Send one request with three months of statements and get options from our network of funding partners in plain dollars, or a straight answer that a bank would serve you better.