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8 Small Business Financing Options for People with Bad or No Credit

fast moneyAfter making the only New Year’s resolution that matters, maybe it’s time to use the resulting savings by turning it into an investment. A small business is one option, but they can be costly to maintain.

Of course, there’s certainly nothing wrong with getting a little help. That’s why there are multiple small business financing options to choose from. Most of these are available for almost anyone — even people with bad or no credit.

With that in mind, here are some of the best small business financing options for those who may have little to no credit:


Online crowdfunding has been a recent and major innovation for those seeking donations or quick funds. Crowdfunding platforms such as Kickstarter, Angel Investing, and Indiegogo, have taken the hassle out of traditional business finance and made it more straightforward for young entrepreneurs and small businesses everywhere — even for those with poor or unestablished credit. Gone are the days of acquiring financial connections to see if venture capitalists are willing to invest in a small business. With crowdfunding, people from all over the world provide that much needed funding.

Venture Capitalists

Venture capitalists are the most difficult financing option for small businesses. As a type of private equity, there are no true qualifications needed. However, a lot more work is needed to demonstrate the financial growth potential of your small business; think of meeting with venture capitalists as an audition and look at every potential capitalist as a judge. If a venture capitalist sees true value in investing in someone’s small business, then the funding opportunity could be huge.


Grants can be issued to a small business by the government under certain criteria. There are also several other organizations that may hand grants out to those who demonstrate other qualifying criteria that they are interested in providing funding for. For instance, the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) are grant programs that extend funding opportunities to small companies which emphasizes technology innovation and scientific research. Applicants must operate a for-profit business, have no more than 500 employees, and meet other eligibility requirements.

Small Business Loans

Like personal loans, there are several small business loans that cater to those with no credit. Depending on the lender’s qualifications, funding can be received in as little as a few business days. Paying off a small business loan may also turn that low credit score around and could improve it for future financial opportunities.

Auto Equity Loans

Another example of personal loans for a small business comes in the form of title loans. An auto title loan can provide funding for small business owners who own a qualified vehicle with a title in their name; the car is then used as a form of collateral to secure the loan. Many title loan lenders are put under tight regulations which vary between the states. Car title loan qualifications are also minimal, with no credit checks required by many lenders.

Installment Loans

With small structured payments, you have more capital to work with when getting an installment loan. Installment loans are especially appropriate for companies with seasonal business cycles.

Cosign Loans

Cosign loans are personal loans that have the potential to promote credit score growth, while also creating a safety net for the lender. These loans are typically considered a last resort becauseif the primary borrower defaults on the loan, then the cosigner must continue paying the remaining loan balance. For this reason, most people refuse to cosign loans for others. However, if you can secure a cosigner,this type of loan can provide ample small business funding.

Credit Cards

Of all the types of personal loans that are available as small business financing options, credit cards are the quickest forms of easy funding — especially for someone who is just starting out. The drawback to this approach is the extremely high interest rates.

Photo Credit: Tax Credits

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