Introduction
Starting or expanding a business requires capital, and securing a business loan with low interest can be a game-changer. With so many lending options available in 2025, understanding the best strategies to qualify for a loan with favorable terms is crucial. This guide will walk you through the top 10 ways to get a business loan with low interest and the best lenders to consider.
1. Improve Your Business Credit Score
A high credit score increases your chances of securing a low-interest loan.
✅ How to Improve It:
- Pay bills and debts on time
- Reduce credit utilization
- Maintain a long credit history
🔹 Ideal Business Credit Score: 75+ (on a scale of 1-100)
2. Choose the Right Type of Business Loan
Not all loans are the same. Picking the right type can lower your interest rates.
| Loan Type | Best For | Interest Rate |
|---|---|---|
| SBA Loans | Small businesses | 3% – 6% |
| Term Loans | Large investments | 6% – 15% |
| Business Lines of Credit | Short-term funding | 7% – 20% |
| Equipment Financing | Purchasing machinery | 4% – 12% |
| Invoice Financing | Managing cash flow | 1% – 3% (per month) |
3. Compare Different Lenders
Interest rates vary by lender. Always compare multiple options before applying.
Best Lenders for Business Loans in 2025:
| Lender | Loan Type | Interest Rate |
|---|---|---|
| SBA (Small Business Administration) | SBA Loans | 3% – 6% |
| Bank of America | Term Loans | 6% – 12% |
| Kabbage | Line of Credit | 9% – 20% |
| Fundbox | Invoice Financing | 1% – 4% per month |
| Lendio | Multiple Loan Options | Varies |
4. Apply for Government-Backed Loans
Government programs, like SBA loans in the U.S., offer lower interest rates and flexible repayment terms.
✅ Benefits of Government Loans:
- Lower interest rates
- Longer repayment periods
- Easier qualification criteria
🔹 Examples:
- SBA 7(a) Loan – For small business expansion
- SBA Microloan – For startups needing up to $50,000
5. Provide Collateral to Secure a Loan
Secured loans have lower interest rates because they are backed by assets.
🔹 Best Collateral Options:
- Real estate
- Equipment or machinery
- Inventory
- Accounts receivable
✅ Pro Tip: If you don’t have assets, consider getting a personal guarantor for the loan.
6. Work with Online Lenders for Faster Approvals
Online lenders often provide quicker loan approvals and competitive interest rates.
📌 Best Online Lenders for Business Loans in 2025:
- BlueVine
- OnDeck
- Funding Circle
🚀 Why Choose Online Lenders?
✅ Faster application process
✅ Lower credit score requirements
✅ More flexible loan terms
7. Show Strong Business Financials
Lenders prefer businesses with stable financial health.
📌 What Lenders Look For:
- Consistent revenue growth
- Positive cash flow
- Strong profit margins
✅ Tip: Prepare financial statements (profit & loss, balance sheet, tax returns) before applying.
8. Consider Peer-to-Peer (P2P) Lending
P2P lending platforms connect businesses with individual investors, often offering lower interest rates.
📌 Best P2P Lending Platforms in 2025:
- LendingClub
- Prosper
- Funding Circle
✅ Advantages:
- Flexible repayment terms
- Lower interest rates than banks
- Faster loan approvals
9. Negotiate Loan Terms
Many business owners don’t realize they can negotiate loan terms with lenders.
📌 How to Negotiate:
✅ Ask for a lower interest rate if you have a strong credit profile
✅ Offer higher collateral to reduce risk for the lender
✅ Compare different loan offers and leverage them in negotiations
🔹 Tip: A financial advisor can help you negotiate better loan terms.
10. Look for Special Loan Programs for Startups & Small Businesses
Many lenders offer special programs for startups or minority-owned businesses.
📌 Examples:
- SBA Microloans (For startups needing up to $50,000)
- Grants & Subsidized Loans (Government programs for specific industries)
- Minority & Women-Owned Business Loans (Lower interest rates for underrepresented groups)
🚀 Pro Tip: Check with local banks and community development financial institutions (CDFIs) for special loan programs.
Frequently Asked Questions (FAQs)
Q: What is the easiest business loan to get?
A: SBA Microloans, business lines of credit, and invoice financing have lower approval requirements.
Q: What is the average interest rate for a small business loan?
A: It varies, but SBA loans range from 3% – 6%, while traditional bank loans range from 6% – 15%.
Q: How can I get a business loan with bad credit?
A: Consider P2P lending, secured loans, or working with online lenders with flexible credit requirements.
Conclusion
Getting a business loan with low interest in 2025 requires preparation, comparison, and strategic decision-making. Whether you choose an SBA loan, online lender, or P2P platform, understanding the loan terms and improving your business credit score will help you secure the best rates.
📢 Ready to finance your business? Start comparing lenders today and secure the best deal!