See funding options side by side
One table comparing eight ways to fund a business by typical cost, speed, term, requirements and best use. Categories, not companies. The ranges show what qualified applicants are getting in today's market, and the only terms that bind 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 in business, bank statements and steady deposits | Owners who have been turned down by banks; a brief, high-margin need that can't sit around waiting for 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, where payments ought to rise and fall with sales |
| Business credit line (bank) | Prime + 1–5%, roughly 9–14% APR | 1–4 weeks | Revolving, annual review | 2+ years, 680+ FICO, financials | Ongoing shortfalls; for a qualified business, no flexible money costs less |
| Online line of credit | Roughly 20–60% APR | 1–3 days | Revolving, 6–12 month draws | 6–12 months, 600+ FICO, statements | A credit line for when the bank's minimums or timeline aren't a match |
| Bank term loan | Roughly 8–14% APR | 2–8 weeks | 1–10 years, monthly | At least 2 years, a FICO of 680 or higher, tax returns, frequently collateral | Projects planned far enough out to qualify; beaten on cost only by SBA |
| SBA 7(a) loans | Prime + 2.25–4.75%, roughly 10–14% APR | 30–90 days | 7–25 years, monthly | At least 2 years, a FICO of 680 or higher, a complete package and a personal guaranty | If time permits, the biggest amounts, longest terms and least costly capital open to a small business |
| 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 backs the deal, pricing comes in well 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 whose reliable customers take 30–90 days to pay them |
These are not offers but typical cost ranges for small businesses in the U.S., current as of the date this page was updated. Advance APR-equivalents are based on 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. With an MCA, you sell a fixed amount of your future receivables at a discount, getting a lump sum up front and then paying a set daily or weekly amount, or a share of card sales, until the full purchased amount has been delivered. Since this is not a loan, it has no interest rate: what it costs is the gap between the amount you receive and the amount you remit, stated as a factor rate, and you can only line that factor rate up against a loan after converting it to an APR-equivalent over the same term.
What's the right way to compare a factor rate against an interest rate?
Put both into dollars across the same number of months, and then into APR. A $50,000 advance priced at 1.30 for six months runs $15,000, which is roughly 109% APR-equivalent with daily remittance. Borrow the same $50,000 from a bank at 12% APR for six months and the term loan costs roughly $1,770. When a bank can't fund a short, high-margin use quickly enough, the advance could still be the better tool; what matters is looking at both numbers before you pick.
When is a bank the better choice?
When it can give you a yes within the time you have. A bank term loan or line of credit costs a fraction of what an advance does, and an SBA 7(a) loans costs even less. Start there if your business is two years old, your score is 680 or higher and your financials are clean. Alternatives are worth what they cost when the opportunity or gap can't wait, or when a bank has already turned you down.
Want to find out what your numbers return?
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.