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Quick Answer

The right type of business funding depends on five factors: (1) time in business: most traditional lenders require 2+ years; (2) monthly revenue: determines how much you can borrow and repay; (3) credit score: affects which products you qualify for and at what rates; (4) urgency: if you need capital very quickly, MCA or merchant services are typically the only options; (5) use of funds: equipment financing is cheapest for equipment, invoice factoring is cheapest for A/R gaps.

Free Tool

Business Funding Decision Tree

Answer 5 questions about your business and get a personalized recommendation for the right type of financing, ranked by cost and fit for your specific situation.

Mechanic in coveralls writing on a clipboard beside a car in his own workshop.
The five questions on this page are the ones a provider asks about your file, not about your ambitions.
1
How long has your business been operating?
Time in business affects which products you qualify for more than almost any other factor.
2
What is your average monthly revenue?
Based on your last 6 consecutive months of bank deposits.
3
What is your personal credit score (approximate)?
Your personal FICO score affects rates and eligibility for most business lending products.
4
How quickly do you need the funds?
Urgency is the biggest single factor in which products are actually available to you right now.
5
What do you need the funding for?
Use of funds determines which product type is the best structural fit, not just which you can access.
Your Personalized Recommendation
Best Fit
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Typical Cost
Speed
Min. Credit
Also Consider
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Shopkeeper working through a stock list on a tablet in front of racked rolls of material.
Use of funds decides the answer as much as revenue does: equipment, stock and receivables each have a cheaper route.
Full Financing Options Comparison
Every major type of small business financing, ranked by cost, with minimum requirements for each.
Product Typical APR / Cost Speed Min. Time in Biz Min. Credit Min. Revenue Collateral
Small Business GrantFree2-6 monthsVariesVariesVariesNone
SBA 7(a) Loan10-13%30-90 days2+ years640 FICO$50K+/yrRequired
CDFI Loan6-20%2-8 weeks6-12 months550 FICO$15K+/yrSometimes
Equipment Financing6-18%3-10 days12 months600 FICO$30K+/yrEquipment
Business Line of Credit8-30%1-4 weeks (new)12 months660 FICO$50K+/yrSometimes
Invoice Factoring12-60%/yr est.1-3 days3 monthsNo min.B2B invoicesInvoices
Business Credit Card18-30%Minutes (if approved)None640 FICONoneNone
Online Term Loan20-60%1-3 days12 months580 FICO$50K+/yrSometimes
Merchant Cash Advance60-120%+ (true APR)Fastest, provider-set6 months500 FICO$4K-$6K+/moNone

MCA APR shown as true IRR-based declining balance rate. Convert any factor rate to APR →

Cost vs. speed trade-off across financing products Scatter comparison plotting typical cost against typical funding speed for nine products: small business grants are free but slow, SBA 7(a) loans are low-cost but take 30 to 90 days, CDFI loans are low-to-moderate cost over 2 to 8 weeks, equipment financing is low cost and funds in 3 to 10 days, a business line of credit is moderate cost over 1 to 4 weeks for a new line, invoice factoring and online term loans sit in the middle on both cost and speed, and merchant cash advance is the highest cost but fastest to fund. Higher cost Lower cost Slower Faster Grant SBA 7(a) CDFI Equipment LOC Factoring Online loan MCA
Frequently Asked Questions
How do I know what type of business funding I need?
The right product depends on five factors: time in business, monthly revenue, credit score, urgency, and use of funds. The interactive tool above weighs all five and returns a ranked recommendation. The core logic: urgency often forces your hand (MCA is typically the fastest option when time is short, though exact funding timing is set by the provider), and use of funds determines structural fit (equipment financing is always cheaper than MCA for equipment when time allows).
What is the cheapest type of small business financing?
From cheapest to most expensive: grants (free), SBA loans (10-13% APR), CDFI loans (6-20%), equipment financing (6-18%), business line of credit (8-30%), invoice factoring (12-60% annualized), business credit card (18-30%), online term loan (20-60%), merchant cash advance (60-120%+ true APR). Use the cheapest product you qualify for given your timeline.
How quickly can a small business get funded?
Speed by product: MCA is typically fastest, with exact timing set by the funding provider, followed by invoice factoring (1-3 days), online lender (1-3 days), equipment financing (3-10 days), LOC draw on existing line (same day), new LOC (1-4 weeks), SBA Express (5-10 business days), SBA 7(a) (30-90 days). If you need capital very quickly, MCA is typically the only option that can deliver on that timeline.
Can I get a business loan with bad credit?
Yes. Several products serve borrowers with challenged credit. MCAs approve with 500+ FICO, CDFIs serve 550+ FICO, and invoice factoring has no minimum credit score (underwritten on your client's creditworthiness). The trade-off is cost: lower credit means higher rates and fewer options. Building credit over 12-24 months while using accessible products is usually the right long-term strategy.
How do I know which business funding option is right for me?
The most important factors are your FICO score, time in business, and how quickly you need the money. If you need capital very quickly and have a 500+ FICO, MCA is typically the fastest path, with exact timing set by the funding provider. If you can wait 60+ days and have 680+ FICO, an SBA loan offers lower cost. Use the decision tree above to map your specific situation.
Can I qualify for business funding if I have bad credit?
Yes. MCA approves at 500 FICO minimum and evaluates revenue more heavily than credit score. Revenue-based financing options like MCA were specifically designed for businesses that do not qualify for traditional bank products.

Not Sure Which Path Is Right? Talk to T.A.G.

We will tell you what you qualify for across multiple products, including options besides MCA, before you commit to anything.

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Explore Your Options

Do I Qualify for MCA? Options with Bad Credit MCA vs SBA Loan MCA vs Line of Credit MCA vs Invoice Factoring Startup Funding Funding after provider review Available

T.A.G. Business Funding

See If Your Business Qualifies

500 FICO minimum. Bank declines OK. Revenue matters more than credit score. Revenue matters more than credit score.

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500 FICO minimum  ·  $4K-$6K+/month revenue  ·  Funding timing is set by the funding provider after review

More Funding Resources

MCA vs Business Loan MCA Timeline MCA vs SBA Loan All Funding Options Qualification Guide MCA FAQ

How to Choose Business Funding: Step-by-Step Decision Guide

Answer these 5 questions in order to identify your optimal funding path.

  1. Step 1: How long has your business been operating?

    Under 6 months: personal financing only. 6-12 months: MCA or microloans. 1-3 years: MCA, fintech loans, SBA Express. 3+ years: full range including SBA 7(a), bank term loans, LOC, equipment financing.

  2. Step 2: What is your average monthly revenue?

    Under $10K/month: MCA typically unavailable; consider microloans. $10K-$30K/month: MCA advance up to $30K-$45K. $30K-$100K/month: MCA $25K-$150K, fintech loans available. Over $100K/month: full MCA range ($50K-$500K+), bank products available.

  3. Step 3: What is your personal credit score?

    Under 500: MCA decline likely. 500-579: MCA at higher factor rates (1.40-1.50). 580-679: MCA, fintech term loans, business credit cards. 680+: adds SBA eligibility. 720+: best factor rates, conventional bank products.

  4. Step 4: How quickly do you need the funding?

    If your need is urgent: MCA is typically the primary option, though exact funding timing is set by the provider. 1-5 business days: MCA or fintech term loan. 1-4 weeks: fintech LOC or equipment financing. 1-3 months: SBA Express, credit union. 3-6 months: SBA 7(a) or conventional bank loan.

  5. Step 5: What will you use the funds for?

    Equipment: equipment financing (8-15% APR, asset-secured). B2B invoice gaps: invoice factoring (1-3%/month). Seasonal inventory: MCA is well-suited. General working capital: LOC if available, MCA if urgent. Operating losses: no financing product fixes a structural loss.

Business Funding Product Selector: Qualification Requirements and Best-Fit Scenarios (2026)
Product Min FICO Min TIB Funding Speed Best For
MCA5006 monthsFastest, provider-setUrgent capital, no collateral, fast ROI use case
Business LOC (Online)600-6406 months1-3 daysRecurring cash flow gaps, revolving needs
Fintech Term Loan580-62012 months1-5 daysLonger-term capital at lower cost than MCA
SBA Express6502 years1-3 weeksUp to $500K at SBA rates, faster than 7(a)
SBA 7(a)6802 years4-12 weeksLargest amounts ($500K+), lowest rates, long terms
Equipment Financing6006 months1-5 daysEquipment only; asset-secured, 8-15% APR
Invoice FactoringN/AN/A1-3 daysB2B invoices; advance 85-95% of AR face value
Minimum FICO score by product, lowest to highest Bar chart ordering products by minimum FICO score requirement: MCA at 500, equipment financing at 600, business line of credit online at 600 to 640, fintech term loan at 580 to 620, SBA Express at 650, and SBA 7(a) at 680, with invoice factoring requiring no minimum personal credit score since it is underwritten on the client's creditworthiness instead. 500 MCA 600 Equipment 600-640 LOC 580-620 Fintech 650 SBA Express 680 SBA 7(a)