Every business needs capital to operate and grow, but sometimes you’re short on funds to do so. Maybe your customers have unpaid invoices, creating a cash crunch, or you simply need more money than you’ve got in your business bank account to cover an expense.
That’s when financing comes in handy. But what if you don’t qualify for a traditional small business loan with a lender like a bank or the SBA?
Fundbox might be the solution you’re seeking.
What is Fundbox?
Fundbox is an online lender that provides small business owners with a line of credit, giving them access to funds they can use to build and grow their businesses.
How Do Fundbox Small Business Loans Work?
Unlike with small business loans, a Fundbox line of credit does not provide a lump sum payment all at once. Instead, borrowers have access to funding up to a designated credit limit. They can borrow as much or as little as they’d like, and once they repay that amount, the funds are replenished.
Once borrowers take out funds from that credit line, weekly repayments will be automatically deducted from their business checking account.
How Does Fundbox Compare to Other Lenders?
Unlike many lenders, such as banks or the Small Business Association, online lender Fundbox doesn’t put as much emphasis on high credit scores to qualify applicants.
Instead, the lender looks at annual revenues to make its credit decision. During the application process, you can connect your bank or accounting software to show your revenues when applying for Fundbox credit.
Fundbox reviews are overwhelmingly positive, giving accolades for fast turnaround on loan applications and funding, as well as stellar customer service.
Terms, Requirements, Rates, and Fees
Fundbox isn’t the cheapest financing out there, but for those who don’t qualify for other options, it’s still a worthy contender.
Fundbox interest rate fees vary from applicant to applicant. The current rate for: .
Unlike many other online lenders, Fundbox doesn’t charge origination fees, nor fees for early repayment.
Fundbox Pros and Cons
If you’re considering opening a revolving line of credit with Fundbox, be aware of the benefits and drawbacks.
Fundbox allows you to borrowfor your business. Rather than requiring a high credit score, Fundbox looks at your annual revenue by connecting to your accounting software or business bank account.
Funds can be deposited the next business day, so you don’t have to wait for your money like you would with a bank loan.
There is no early repayment fee. Also, the Fundbox app is a convenient way to manage your account and withdraw funds, and it comes with great customer service.
Fundbox lines of credit must be paid back with weekly payments, which may cut into your cash flow, especially if you don’t have steady revenue coming in each week. The repayment period is short:.
Fees may be higher for Fundbox than traditional loans or SBA loans.
How to Qualify for a Loan from Fundbox
While you don’t need a high business credit score, you will need a credit score of at least 500, as well as annual revenue of $50,000 or more. Borrowers must have been in business for at least two to three months.
If you don’t yet have business credit, learn how to establish business credit before applying.
How to Apply for a Loan from Fundbox
The Fundbox loan application is short and sweet:. You will be asked questions about your business, including annual revenue and date established. You’ll then have the opportunity to connect your business bank account or accounting software so that your revenue information can be verified.
Fundbox will verify your credit score and set you up with a Fundbox account, where you can see how much as a borrower you are eligible for with your new credit line. You can take out funds up to the maximum amount you are approved for, and as you pay back those funds, the line is replenished.
Your weekly payments will be automatically deducted from your business checking account until the loan is paid off.
Alternatives to Fundbox Loans
If Fundbox doesn’t seem like the right fit, you do have other options, even if you don’t have excellent credit.
If you receive invoices from clients, you may want to consider invoice financing or invoice factoring. Invoice financing uses the value of your invoices as collateral for a loan. Invoice factoring allows you to sell your invoices at a discount to get cash in hand.
Business credit cards are another option. Yes, some come with high interest rates, but if you pay your balance in full each month, you can avoid those fees. Also, many offer a 0% introductory offer and rewards that can essentially pay you to use the card.
Nav’s Verdict: Fundbox
When cash flow gets crunched, maybe because of outstanding invoices or unexpected expenses, a loan or line of credit could be the solution.
With fast financing and an easy repayment schedule, Fundbox is a valid option for your financing needs.
See how much you qualify for with Fundbox.
This article was originally written on January 28, 2021 and updated on September 19, 2022.