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According to recent data, large and small banks approved a total of 35.2% of small business loan applications, more than any other type of lender.[1]
Bank loans are one of the best financing options for small businesses—offering low interest rates and competitive terms. If you have strong credit and several years in business, a conventional bank loan or SBA loan is worth considering.
Here’s our list of the best banks for business loans, plus tips on how to qualify for financing.
Best Banks for Conventional Business Loans
When comparing the best banks for business loans, you should think about:
- Types of small business loans they provide
- Application process and time to funding
- Interest rates and repayment schedule
- Customer service
- Location and branch availability (Is it a national, regional, or community bank?)
Considering their loan products and lending volume, these are some of the best banks for conventional business loans.
1. Bank of America
With approximately 4,200 branches and strong mobile banking capabilities, Bank of America is a competitive bank lender for small business owners throughout the country. Bank of America business loans are a particularly good option for borrowers with two or more years in business, as well as those that want to choose from a variety of different financing options.
As of August 2021, Bank of America had the most commercial and industrial loans among banks—with over $80 million more in loan volume than the next closest lender.[2]
Bank of America Business Term Loans
Bank of America offers unsecured and secured business term loans. Unsecured loans are available in amounts from $10,000 to $100,000 and secured loans are available in amounts from $25,000 to $250,000. Both types of loans are fixed rate, with monthly repayments.
Unsecured loans have terms from 12 to 60 months and secured loans have terms up to four years when the loan is secured by business assets and up to five years when it’s secured by a certificate of deposit.
To qualify for either loan, you’ll need at least two years in business—and $100,000 in annual revenue for the unsecured loan, or $250,000 in annual revenue for the secured loan.
Bank of America Business Lines of Credit
Bank of America also offers unsecured and secured lines of credit. The unsecured line of credit is available in amounts of $10,000 and up, and revolving terms with annual renewal. To qualify, you need at least two years in business and $100,000 in annual revenue.
The secured line of credit, on the other hand, is available in amounts of $25,000 and up, and the same revolving terms. To qualify, you need at least two years in business and $250,000 in annual revenue. You can secure your credit line using a blanket lien on your assets or a certificate of deposit.
Additional Loan Options
Bank of America offers additional loans, such as business auto loans, equipment financing, commercial real estate loans, and more.
A benefit of working with Bank of America for business loans is their relationship rewards program, where you can get a lower rate if you maintain high balances across your BoA accounts.
For most of their loan options, you’ll need to schedule a phone or in-person appointment with a lending specialist in order to submit an application.
2. JPMorgan Chase
As of August 2021, Chase had over $190 million in commercial loan volume[2] and in fiscal year 2022, the bank has already issued over $71 million in SBA 7(a) loans alone.
Chase offers a wide variety of lending options—from lines of credit and SBA loans to equipment financing and real estate financing. If traditional bank loans don’t make sense for your business, however, Chase also provides a lineup of rewards-earning small business credit cards for you to consider as well.
Chase Business Loans
Chase offers term loans starting at $5,000 with terms from one to seven years and fixed monthly payments. These Chase business loans can come with either fixed or variable interest rates.
Chase also offers two different lines of credit, a business line of credit, and a commercial line of credit. The standard business line of credit is designed for financing needs up to $500,000, and the commercial line of credit accommodates larger credit line amounts.
The Chase website doesn’t provide details about how to qualify for financing, so you’ll have to contact your local Chase branch for more information.
Chase Business Credit Cards
Startups or businesses that need smaller amounts of funding might opt for a business credit card instead of a traditional business loan.
Chase is a leader in business credit cards, offering cards with no annual fee, competitive reward rates, signup bonuses, and even cards with one full year of a 0% introductory rate before your variable rate sets in.
Use our guide to learn more about Chase business credit cards.
3. Wells Fargo
With years of experience in the small business lending space, Wells Fargo can be a great choice to work with if you need bank financing.
Although the bank discontinued some of its well known small business loan solutions in 2021, as of August that year, Wells Fargo still had a balance of more than $160 million in commercial loans.[2]
Plus, Wells Fargo continues to offer their competitive business line of credit products which can be a good funding option for a wide variety of small business owners.
Wells Fargo Business Lines of Credit
Wells Fargo offers an unsecured and a secured business line of credit. The unsecured line of credit is available in amounts ranging from $5,000 to $100,000 with no collateral required. With this Wells Fargo business loan, you can receive rewards points for spending on your credit line, similar to a credit card.
If you’re a new customer, you can receive no annual fee for your first year with the product. You also have the option to apply for the Wells Fargo unsecured business line of credit online.
The secured line of credit, on the other hand, is backed by your business assets and is available in amounts ranging from $100,000 to $500,000. To apply, you’ll need to call or visit a Wells Fargo branch.
4. Capital One
Although Capital One may be better known for their consumer programs, the bank has invested in their small business lending program—as of August 2021, they had a commercial loan volume of over $34 million.[2]
If you’re looking for a wide array of financing products, such as lines of credit, equipment and vehicle loans, commercial real estate loans, among others, Capital One is a top bank for business loans. And, Capital One small business loans often include relationship-based rates for existing customers, as well as other perks.
Capital One is one of the best banks for business loans if you already have a relationship with them.
Capital One Business Lines of Credit
Although Capital One offers a variety of loan options, one of their top products is their business line of credit. These credit lines start at $10,000 and are well-suited for improving cash flow for your daily operations.
Fees and interest rates will vary based on the size of your line of credit and your business’s qualifications. In general, you’ll need at least two years in business, and have (or be willing to open) a Capital One business checking account to qualify.
To apply, you’ll need to visit a Capital One location and work with a business lending representative.
5. U.S. Bank
U.S. Bank is one of the biggest lenders for small business loans—over $78 million in commercial loan volume—but has limited geographic reach.[2] The bank only has branches in 26 states and is concentrated in the West and Midwest.
Nevertheless, U.S. Bank business loans range from term loans to lines of credit, to equipment financing, and commercial real estate loans. They also offer a unique type of business financing called practice financing, which helps dentists, veterinarians, and eye doctors start a new practice, acquire a practice, or expand.
U.S. Bank Business Loans
Among all the different types of small business loans U.S. Bank offers, there are two noteworthy products that you can apply for quickly and easily online.
The Quick Loan is a term loan that can be used for a variety of purposes and is available in amounts ranging from $5,000 to $250,000. This loan has fixed rates and monthly payments with terms up to seven years. U.S. Bank offers this product in secured and unsecured options.
For working capital needs, U.S. Bank offers the Cash Flow Manager line of credit. This credit line is available in amounts up to $250,000 with variable interest rates and the option to lock in fixed rates on existing balances.
You can apply for both of these loans online—and if you’re a U.S. Bank customer enrolled in online banking, you’ll be able to prefill some of the loan application to expedite the process.
Best Banks for SBA Loans
When talking about the best banks for business loans, we’d be remiss to not bring up SBA loans.
SBA loans are issued by banks, credit unions, and other lenders and guaranteed by the U.S. Small Business Administration. The government guarantee mitigates the lender’s risk when working with you, incentivizing banks to issue loans to more small business owners.
You’ll still need strong credentials to access SBA financing, however, as these loans offer competitive interest rates and repayment terms.
Here are some of the best banks offering SBA loans.
1. Live Oak Bank
In 2021, Live Oak Bank was the most active SBA 7(a) lender in the country—and the bank continues to top the list in fiscal year 2022, approving a total of $724,302,000 in loan volume as of March 31.
This bank, based in Wilmington, North Carolina, has no consumer loan products and no physical branches. Instead, they focus almost exclusively on small business loans, especially SBA loans. They’ve provided over $2 billion in small business funding since they started operating.
Live Oak Bank has a streamlined, electronic application process for their SBA loans, since they don’t rely on branches. You can upload all loan documentation online and monitor the progress of your loan at any time in your online account, expediting the underwriting process and helping you get funded more quickly.
2. Wells Fargo
One of the best banks for SBA loans, as well as conventional bank loans, Wells Fargo has approved 915 SBA 7(a) loans in the first quarter of 2022 for a total of $156,851,400.
In addition to 7(a) loans, Wells Fargo also offers SBA 504 financing for business owners who want to purchase real estate, equipment, or other fixed assets.
With Wells Fargo’s experience in issuing SBA loans, they can underwrite and process your loan faster than some other lenders. You can learn more about Wells Fargo SBA loans by working with a local small business lending specialist.
3. Huntington National Bank
Huntington National Bank has currently approved the most SBA 7(a) loans in 2022— 2,279 loans in Q1 for a total of $346,276,400 in funding.
Huntington Bank participates in the SBA 7(a) general purpose business loan, SBA 504 loan, and SBA Express loan programs.
And although Huntington Bank is only located in 11 states, the lender is consistently recognized as a top SBA lender in the region. You can even find a local SBA lending specialist in your state using the Huntington Bank website.
4. Celtic Bank
Like Live Oak Bank, Celtic Bank offers a completely online banking experience. This bank has a few consumer products, but similarly specializes in SBA loans and conventional business loans.
So far in 2022, Celtic Bank has approved 276 SBA 7(a) loans, lending a total of $268,484,700. Celtic also offers SBA 504 loans, as well as SBA Express loans.
To get started, all you have to do is complete a simple seven-question online application. Once completed, Celtic Bank will predict whether you can get approved for a loan and offer you alternative loan options.
5. TD Bank
If your business is located on the East Coast, TD Bank is going to be one of the best banks for small business loans. TD Bank has been ranked one of the top SBA lenders on the East Coast—and currently, has issued 658 7(a) loans for a total of $65,957,200 in 2022.
TD Bank offers SBA 7(a) loans, SBA 504 loans, and SBA Express loans. Unfortunately, they don’t offer the convenience of an online application process. You must schedule an appointment at a TD Bank branch to apply.
How to Qualify for Banks Loans for Business
Small business bank loans have low interest rates, long terms, and manageable monthly payments—but you’ll need strong personal and business finances to qualify.
Here are some criteria that business lenders will consider when determining your eligibility:
Personal Credit
Bank loans for business will require a strong personal credit score. Business lenders—both commercial loan companies and banks alike—will look to your personal credit score to gauge your financial responsibility.
As a result, you—or any of your co-owners—will likely need a FICO score of at least 700 to be able to qualify for a business loan from one of these banks. The top business loan providers might even look for excellent personal credit—think 750 or higher—for you to qualify.
Business History
Typically, at least two years in business are required to be eligible for a small business loan from a bank. If your business has already lasted at least two years, then it’s less risky for a bank to lend you capital.
In some cases, you may be able to apply for a business bank loan with six or more months in business—however, you’ll need impressive business finances and excellent personal credit in order to qualify.
Annual Revenue
The best banks for small business loans won’t lend you any capital if they don’t think you’ll be able to pay it back. Therefore, most of the top lenders will look for at least $100,000 in annual revenue for you to be eligible.
Additionally, many banks will prefer that your business be profitable. You’ll want to make sure you meet every revenue and profitability requirement for a given lender before you take the time to apply.
Complete Business Loan Application
Along with these credentials, you should have a complete, organized business loan application to give the bank all the information they might need to approve your loan.
Of course, the specifics that you’ll need to prepare for your application will vary based on the individual bank you’re working with. In general, you can expect to prepare some, if not all, of the following:
- Personal background/resume for anyone who owns 20% or more of the business
- Business plan
- Personal and business tax returns
- Financial statements
- Bank statements
- Use of loan statement
- Debt schedule
- Statement of collateral
- Legal documents (licenses, registrations, articles of incorporation, etc.)
The Bottom Line
Our list of the 10 best banks for business loans covers both conventional business funding options and SBA loans. But if you don’t qualify for a traditional business loan from a bank, there are alternative lending options you might consider to find affordable, quick, and easy capital to grow your business.
Check out our guide to compare some of the best alternative lenders.
Randa Kriss
Randa Kriss is a senior staff writer at Fundera.
At Fundera, Randa specializes in reviewing small business products, software, and services. Randa has written hundreds of reviews across a wide swath of business topics including ecommerce, merchant services, accounting, credit cards, bank accounts, loan products, and payroll and human resources solutions.