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Everyone starts somewhere. The process of building a business credit profile isn’t incredibly different from building personal credit; making payments on time and avoiding carrying high balances are always good practices, but the tools will be different.
Many business owners will start out with credit cards specifically designed for startups or those with little to no business credit history, but after time, you’ll likely be looking to graduate to bigger products that can help your business grow and allow you to expand your credit profile. Here, then, are five business loans that can help build your business credit.
1. Chase Business Term Loans
Most any bank will offer business loans or other basic business financing options, but Chase can boast that they report to all major commercial credit agencies (Dun & Bradstreet, Equifax, Experian, SBFE). That means that as you make your payments on time and keep your balance down with a Chase loan, your diligence and hard work will likely reflect on your business credit report, more likely than with most other major lenders.
Chase business term loans start at $5,000, offer fixed and adjustable rates, and fixed monthly payments to help you keep a grip on your cash flow. They also offer lines of credit, commercial mortgages, equipment financing, and, of course, credit cards.
2. Citi Business Loans
Similar to Chase, Citi reports to all major business credit bureaus. They also offer a wide variety of credit products from term loans to lines of credit to commercial mortgages. With their reporting procedures, you can add positive history to your business credit profile.
They also offer a service online that prompts you to fill out a worksheet regarding your business needs to be contacted by a Citi lender to discuss further. You can also check with Nav to find a variety of quality financing options and see your business credit score for free.
3. SBA Microloans
Most lenders require that your business have at least two years in operation before approving you for financing. The Small Business Association, along with offering some of the more savory products for veteran small businesses, also offers microloans for younger businesses.
Microloans cap out at $50,000, and the average amount is around $13,000. It’s a great option for those starting a business or continuing to get their fledgling operation off the ground, and a solid way to build a business credit history. While you don’t apply directly with the SBA for a microloan, you can find a lender in your region here.
4. Microloan by Kiva
A non-profit lender designed to help struggling entrpreneurs, Kiva offers 0% APR loans of up to $10,000, all funds coming from a strong community brought together by a desire to help small businesses flourish.
As if 0% interest isn’t enough of a reason to check it out, they also promise to report your good payments to the business credit bureaus, giving your business credit profile some positive marks.
5. Accion Microloans
Another microlender, Accion seeks to help business owners with less-than-excellent credit or who have been in business for just a few months. They require a minimum personal credit score of 575, and lend up to $10,000. Like Kiva, Accion is funded by investors and the donations of a community of people who care about small businesses and a strong economy.
If your business credit isn’t awesome or just needs a few more miles on it, there are certainly options for you. Again, the best practices you’ve learned all your life about personal credit, basic things like paying early or on time, and carrying low balances, can help keep your score healthy and contribute to a strong and sustainable business.
This article was originally written on July 10, 2018 and updated on October 19, 2020.
I feel very good in finding Nav. A lot of info to digest and hopefully finding someone to connect with and lead me on this journey that I am taking.
It been very frustrating and being naive in thinking that I was going to find an angel investor or hard money lender or anyone in giving me money because of my ideas in fix n flip. Hard lessons learned.