Because startup small business loans are riskier, most lenders are usually reluctant to provide loans to aspiring entrepreneurs without collateral. If you’re a small business owner requiring financing to get your business off the ground, you may find it challenging and time-consuming to loan products without collateral.

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3 Best Funding Options
for Small Businesses with
No Collateral
Prepared for: Small Business Owners
Created by: Dave Smansha

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Table of Content
Introduction……………………………………….……………..………………………………………….. 3
Unsecured Business Line of Credit ……………….…………...........................….……….. 3
Features………………………………......….………......……………...…...…...………..……… 4
Merchant Cash Advances ……………………..……………....…………………………...……….. 4
Features………………………………......….………......……………...…...…...………..……… 5
Business Credit Card……………………......……......……………...…...…....………..……… 5

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Introduction:
Because startup small business loans are riskier, most lenders are usually
reluctant to provide loans to aspiring entrepreneurs without collateral. If you’re a
small business owner requiring financing to get your business off the ground, you
may find it challenging and time-consuming to loan products without collateral.
Though starting a new venture with no money and no collateral can be tough but
not impossible. There are a few startup small business loans that you can obtain
without collateral. Thanks to alternative funding options, there are so many loan
products available for startups to grow and flourish.
Have a look at the three most sought-after loans without collateral for new small
business owners.
Unsecured Business Lines of Credit:
An unsecured business line of credit is
undoubtedly the most flexible funding
option for novice small business owners.
You’re given a predetermined revolving
capital that you can use when needed.
Though you may have to put up collateral
to secure a business line of credit when
applying through a traditional bank, most
alternative lenders provide unsecured lines
of credit to startups so they don’t have to
pledge a valuable asset to secure the debt.
If you need immediate access to cash to purchase equipment, hire staff, buy
inventory, make payroll, or other business expenses for your startup, you should
consider an unsecured line of credit without a collateral requirement.

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7 Factors Lender Consider When Applying for a
Small Business Loan
Features:
Loan Amount $100,000
Repayment Terms 3-18 months
Interest Rate As low as 8%-24%
Time to Funds As soon as 1-2 weeks
Merchant Cash Advances:
It is another great funding option for aspiring
entrepreneurs lacking collateral to
successfully start and grow their businesses.
With an MCA, you’re given a lump sum of cash
that you can use for a variety of purposes in
your startup business. Typically, an MCA is not
a loan but an advance payment against your
business’ future income.
You don’t give weekly or monthly payments
with an MCA but it is repaid automatically
using a percentage of your daily debit or
credit card receipts, plus an additional fee. Whether you’re looking to purchase

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inventory, bridge cash flow gaps, open a new location, market your products and
services, or pay off debt, an MCA has got you covered.
As compared to many of its funding counterparts, MCA is an easy and quick way
to get extra working capital for your startup. Moreover, a fast approval process,
lesser documentation with no collateral requirements will suit most startup
businesses. Even if you don’t have a perfect credit score, you can still apply.
Features:
Loan Amount Up to $200,000
Repayment Terms Up to 2 years
Interest Rate As low as 18%
Time to Funds As soon as 24 hours
Business Credit Cards:
If you’ve just started your new venture
and you need instant cash to cover your
startups’ day-to-day and other
operational expenses, a business credit
card might be your ideal option. You
don’t need to have a perfect credit
history and collateral to apply for a
business credit card.
If you need a flexible funding option and
don’t have time to wait around a loan, you should go for a business credit card.
Though you should have a good personal credit score to get approved for a

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business credit card.
You can use business credit for almost any business-related needs in your
startup, including purchasing equipment, taking clients to lunch, buying
inventory, or simply covering monthly costs.
If you need a loan with collateral for your startup, always apply through an online
lending marketplace. A marketplace will help you find and compare a variety of
startup loan offers without collateral from multiple lenders so you can choose
one that best fits your current financial needs and budget.
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#best funding options for startups