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Start up Business Loans for Bad Credit, Guaranteed Worth It

Reviewed by Ty Crandall

November 14, 2023
Startup Business Loans for Bad Credit Guaranteed Credit Suite

As a new business, you likely have zero business credit. If you didn’t already know, non existing business credit is equal to bad credit. Are there any start up business loans for bad credit guaranteed to work for you?

Working to build and improve business credit is essential to business success, but in the meantime, check out these startup business loans for bad credit guaranteed worth your time.

The start up phase of a small business is often the most difficult. In fact, it is during this time that many business owners max out their own credit card to fund the business.

There are a huge number of challenges that you have to meet during this phase. Often funding is the greatest of these. This is the time when bad credit business loans can be useful.

No traditional lender wants to provide business loans to a high-risk borrower, and that is what you are if you have bad credit.  So, while you are working to build that strong business credit, look at your options for a bad credit business loan.

For this type of financing option, you may have to look to an alternative lender. These often operate online, and they do not typically weigh their decisions as heavily on credit history as a traditional lender does.

Learn bank rating secrets with Credit Suite's free, sure-fire guide.

Small Business Financing Options for Startups with Bad Credit

Using your credit card isn’t your only option. Of course, if you have a bad credit score, it may not even be an option. You need a startup loan that you can get (from a lender or elsewhere) despite a bad credit score.

There are options out there. It is impossible to list them all, which is why diligent research is so important. However, we can get you started.

Kiva Microloans

This is a huge win if you are looking to get a bad credit business loan for a small business. It is an amazing program with few that come close. Basically, Kiva is free. You have to repay it, but there is no interest.

The only requirement is that you lend $25 to another small business on the platform and recruit part of the funds from your own network of family and friends. There is no required minimum credit score.

You also have to submit a lot of paperwork, including a thorough business plan, but hey, isn’t it worth it for free money?

National Funding

National Funding is an online lender that offers rapid finance options to small businesses, sometimes with approval for business loans and funding in as little as 24-hours.

You can get a term loan option in the form of either a secured loan or an unsecured business loan, as well as equipment financing.

According to their website, this lender doesn’t focus on credit alone. They claim they take the time to get to know the owner and the business in an effort to find a funding solution for your specific needs.

They offer a range of options from working capital business loans and more. Some reviews, like this one from NerdWallet, state that this alternative lender has a minimum credit score as low as 600.

Merchant Cash Advance

This is a business funding option that may or may not work for you. Startups can have a hard time with this type of financing because you need established, regular credit card purchases to qualify.

If you have that, then credit doesn’t matter at all. A lender will simply look at how much you have in monthly credit card sales, on average, and lend based on that amount.

Repayment is taken automatically from future credit card sales.


This type of business funding is worth looking into, but it doesn’t work for everyone. There are multiple crowdfunding platforms available these days, all with varying requirements.

This is not technically a small business loan for a bad personal credit score, because this is not a loan at all. There is no repayment. However, it is a type of business funding that does not require a good personal credit score or business credit. Poor credit doesn’t matter at all.

Crowdfunding is a way of allowing the general public to invest small amounts in your company. Usually they do so in exchange for some incentive.

This may be a free product or something else. The rewards may vary depending on the level of investment.

It isn’t a small business loan however, because there is no pay back required.


The most well known crowdfunding platforms from a small business standpoint include Kickstarter and Indiegogo. They differ in a few ways, but the most prominent differences relate to when you receive the funds. With Kickstarter, you will have to set a fundraising goal.

And you do not receive any funds until you reach that goal. If you never reach the goal, then you never see the money.

With Indiegogo you can choose whether you want to wait until you reach your goal or take the funds as they come.

Venture Capital

This is where companies or individuals invest in small start ups.  As an investment, this is obviously not a startup business loan, per se. It is a legitimate funding option that may be available despite poor credit, however.

Venture capitalists are less formal than capital investors, and the amounts offered are usually smaller.  They can do the trick though, and may be just what you need to get you over the funding hump.  

Angel Investors

For very small start ups, the most common form of venture capital comes from angel investors.  These are high net worth individuals that are willing to invest. 

The appeal of business financing from angel investors is that they are informal. Literally anyone, even your mom, can be an angel investor.

As a result of lack of formality, many are not as concerned with consumer credit score or even poor credit as a business. Many do not even do a credit check, because they aren’t respecting repayment in the traditional sense of a startup business loan.

Rather, most angel investors want a piece of the proverbial pie. They want some of the action. They want a share of the profits. You just have to find someone that wants in and has the money. As a result, a more diligent angel may want to look at your cash flow.

Self-funding (Bootstrapping)

Want to know someone who can offer you a startup business loan with no credit check, and in fact may not even care what your credit report looks like at all? Look in the mirror.

I am sure that you are thinking to yourself that if this was a possibility, you would not be reading this article.  I’m not talking about using your credit card either.

A lot of people do not realize the many options there are when it comes to this. The most often overlooked option for self-funding is a loan from a retirement plan.

If you have a retirement account from a previous job, you can likely take a loan from it—with no worries about meeting a minimum credit score or proving a personal guarantee.

It doesn’t require a credit check typically because it is your own money. And when you pay it back, plus interest, then you are just repaying yourself.  

Another option for business financing, without having to prove cash flow, is business credit cards.

Grainger Industrial Supplies

This power tools and hardware vendor actually sells a wide variety of supplies, and they can  take care of auto fleet maintenance as well. Grainger sells power tools, pumps, hardware and other things. In addition, they can handle maintenance of your auto fleet.

Specificsstartup business loans for bad credit guaranteed

You need a business license and EIN number to qualify, as well as a DUNS number from Dun & Bradstreet to get started with them.  

Apply over the phone or by fax. You will need a business license only if you need less than $1,000 in business credit, but if you need more than that you will need trade and bank references as well.


Check out the starter vendor Marathon. Marathon Petroleum Company provides transportation fuels, asphalt, and specialty products throughout the United States. Their comprehensive product line supports commercial, industrial, and retail operations. This card reports to Dun & Bradstreet, Experian, and Equifax. Before applying for multiple accounts with WEX Fleet cards, make sure to have enough time in between applying so they don’t red-flag your account for fraud.

To qualify, you need:

  • A Fundability Foundation™

Your SSN is required for informational purposes. If they are concerned they will pull your personal credit talk to their credit department before applying. You can give a $500 deposit instead of using a personal guarantee, if in business less than a year. Apply online. Terms are Net 15.

Uline Shipping Supplies

Uline reports to Dun & Bradstreet also.  They carry shipping boxes, trucks, dollies, janitorial supplies, and more. In addition to a DUNS number, they will also ask you for a bank reference and two other references.

You may need to prepay at first, but after that they are likely to approve you for Net 30 terms. Prove you can pay them back (perhaps by securing any business credit cards you get) and they won’t ask for a personal guarantee.

With a good business credit score, you will be able to do so much more in the future, including finding financing to grow and expand your business.

Learn bank rating secrets with Credit Suite's free, sure-fire guide.

Are They Safe?

As with anything out of the ordinary, you are going to have those that tell you a nontraditional lender is not safe. They will quote high interest rates and tough payment terms. There will be discussions about how they suck you into a vicious cycle of debt that you cannot escape.

This can certainly happen. It can happen with any debt or small business loan. But high interest rates and harsh repayment terms do make for a slippery slope. The thing is, sometimes the only options you have are to do the hard thing or give up.

If you prepare mentally and have the proper safety nets in place, there is no need to give up just because start up small business loans for bad credit history are scary.

How Do I Prepare?

First, do your research. You will find that many of these funding sources are not as scary as you might think. In fact, some of them reduce risk in creative ways that work to the advantage of both the lender and the borrower.

Next, get your head in the game. You need to know your limits when it comes to repayment of a bad credit business loan. If you end up with financing rather than funding through another source, you are going to have to repay. You will not be able to do that if you over extend.


This means you are going to need budgets and forecasts in place. A lot of it will be a guessing game if you are not in business yet, but that is part of the risk. You need to make a reasonable estimate of what you can handle.

Taking risks is a good thing, but jumping out of a plane without a parachute is not.

Once you have an idea what is available and what you can manage, start your search for start up business loans for bad credit history. Guaranteed is not a word to describe this search, but it is highly likely you will find something that will work.

Learn bank rating secrets with Credit Suite's free, sure-fire guide.

What About a Traditional Term Loan, an SBA Loan, or Business Credit Cards?

The thing about a traditional term loan or an SBA loan is that these business loans are typically harder for startups to get. They require you to be an established business, and a bad credit score is a deal breaker.

A business credit card is another story. While you may qualify without perfect credit, the interest rate is likely to be through the roof.

It’s a great option for backup if you have them, but try not to use them for long-term financing if you can help it, at least in the beginning.

Are Startup Business Loans for Bad Credit Guaranteed Worth the Risk? 

While using a bad credit loan is never something to take lightly, it is almost always worth the risk. Anything worth having generally includes some level of risk.

If you want to run your own small business, if you want to make your dreams come true, you have to fight for it. Don’t let the fear of your bad credit score hold you back.

Just note that, as you use this type of loan, continue to work on your business and personal credit score. As they get stronger, you will be able to get a higher loan amount and possibly a better repayment term. You may even qualify for a revolving business line to help better manage cash flow.

Find a way around the fear and take your dreams into your own hands. You don’t necessarily have to use personal loans to do it.

Discover a new way to get start up small business loans for bad credit now. 

About the author 

Faith Stewart

Faith has a BBA with a major in Accounting, and a combined 20 years of experience in the fields of finance and account.

Before switching to writing, she spent 10 years working in various areas of small business and personal finance and accounting, including working as a public auditor at BKD, LLP, Financial Director at Central Arkansas Development Council, and Commercial Credit Analyst at Farmer's Bank and Trust.

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