The 5 Best Microlenders to Help You Get a Microloan for Your Small Business

Microloans can be game changers for small businesses, especially ones that may not have access to capital or favorable rates otherwise. A microlender can offer low rates to business owners who don’t have great credit or even any credit.

Microloans, which are smaller than traditional business loans, are more manageable for your budget too. You’ll be making payments on a smaller loan — the average size of a Kiva loan is $5,000 vs. $100,000 — while building your credit history.

So where can you get a microloan? There’s an array of microlenders who work with small businesses, granting loans of a couple hundred dollars up to $250,000. Microfinancing is available from the government-backed U.S. Small Business Administration (SBA) to crowd-backed Kiva to nonprofits like LiftFund.

Here are our picks for the best microlenders for small businesses based on interest rates, loan amounts and accessibility.

Microloans are designed to keep interest rates low because they’re often geared toward helping underserved communities and business owners who have less credit history.

Although smaller than traditional business loans, microloans are just as mighty. You can use a microloan for almost anything your small business needs, according to these entrepreneurs.

Kiva U.S. is one of the most popular and user-friendly microlenders on the market. The nonprofit’s biggest selling point is the 0% interest and no fees that it offers on all small business microloans.

To obtain a Kiva loan, you’ll need to go through its application process and:

• Meet the minimum eligibility criteria
• Submit basic financial information
• Have a business plan
• Determine the loan amount you’re applying for
• Create a personal profile with your business story
• Link your social media accounts
• Gather a support network for fundraising

Kiva U.S. is not within the SBA microloan program. Your loan will instead be crowdfunded. The whole process usually takes around two months to complete. Once you secure the loan, you’ll usually have 36 months to repay it.

The biggest drawback to Kiva’s loan service is the process you have to go through to fund your loan. There’s not a ton of paperwork involved, but there is a little hustle. If you’d prefer a lender that only requires an application to decide if you’re qualified, you may want to look elsewhere.

Otherwise, Kiva is one of the only lenders that can help you acquire zero-interest loans. That’s why we love its program.

Pursuit offers a speedy process for businesses that need fast cash, but its limited availability is a big drawback.

Pursuit only offers microloans to business owners in three states: Pennsylvania, New York, and New Jersey. You submit an application, and within just two days, the lender will deliver a decision. From there, funding is provided within five days.

Qualifying requires you to meet specific criteria like having more than $120,000 in annual revenue and having positive or break-even cash flow. You also have to show that you’ve been in business for at least two years and have at least two employees.

If you meet these qualifications, you could get up to $50,000 at interest rates of up to 9.125%. Those are very attractive rates in any market.

So, if you live in one of the states Pursuit services, we recommend submitting an application.

The nonprofit Accion Opportunity Fund is another option offered outside the SBA microloan program. It manages to keep interest rates limited on its microloans—even without SBA support.

Interest rates are higher at Accion Opportunity Fund than at our other top-ranked contenders. But its loan amounts are higher than many microlenders: up to $100,000.

To qualify for a loan through Accion Opportunity Fund, you need to show that you’ve been in business for at least one year and have annual sales totaling $50,000 or more. Once you’ve pre-qualified yourself, simply submit an online application and the process will start.

Accion Opportunity Fund may send you multiple loan offers upon receiving your application. This is one of its biggest benefits: the flexibility to find a good fit for your loan needs. That’s why it’s worth giving Accion Opportunity Fund a try.

A nonprofit, LiftFund offers microloans to business owners in the southern United States and covers 15 states, including Florida, Georgia, and Texas. Microloans from LiftFund are designed to help small business owners improve their credit to qualify for a bank loan in the future.

LiftFund offers loans of up to $250,000. That’s the most of any of our featured lenders. It’s designed to serve communities that may not have access to traditional financing.

LiftFund is a great option for small business owners who could use some support. LiftFund offers events, programs, and coaching specifically designed to help small businesses grow. This boost of help is a nice extra for a lender with extremely low rates.

LiftFund may not operate in your state, but if they do, we recommend submitting an application and seeing what kinds of loans you qualify for.

Justine Petersen offers SBA microloans to people running businesses in southern and central Illinois, eastern Kansas and Missouri. Justine Petersen partners with the U.S. Department of Agriculture and the SBA to offer loans.

One of the perks of working with Justine Petersen is that the company offers both non-SBA-guaranteed loans and SBA-guaranteed loans. The company also provides all business owners with credit score counseling and the opportunity to use credit-building loan products and secured credit cards.

These extras are a nice addition, but the low-interest loans are the big selling point. Justine Peterson does have options that are a bit higher in interest, but its main goal is to help you get the lowest interest loan you qualify for. If not, you’ll be able to pursue other options.

These brands just missed our top five, but you should still be sure to check them out. Both are great lenders with unique offerings.

Opportunity Finance Network connects small businesses with community development financial institutions, also known as CDFIs. These federal initiatives are designed to finance microenterprises in rural, urban, and native communities.

On its site, Opportunity Finance Network breaks down who they serve:

• 61% are people of color
• 83% are low income
• 28% are rural
• 47% are women

This focus on the underserved makes Opportunity Finance Network a great option for marginalized communities to access capital.

Upstart is not technically a microlender. They offer personal loans at the same amount range as a lot of microlenders. The biggest difference between Upstart and a true microlender is that they’re not focused on keeping interest rates low to improve accessibility.

Why include Upstart? Because they’re a good option for acquiring smaller loans if you don’t meet a microlender’s requirements. Perhaps your income is a bit too high or your business is moderately successful. In these cases, you may not qualify for a microloan.

If you want a smaller loan and don’t qualify for a microlender, give Upstart a try.

Microlenders are a great way for businesses to access capital. Our favorite microlender is Kiva because of its 0% interest rates and nationwide availability. But each of our recommendations is excellent in its own right.

• Pursuit can get you funded in just five days.
• Accion Opportunity Fund is great for businesses with a year under their belt.0
• LiftFund offers loan products that will boost bad credit.
• Justine Petersen helps those in lower income brackets.

No matter what you end up choosing, each of these microlenders shares the goal of bringing financing to businesses in need.

A microloan isn’t quite the right fit for you? Check out our favorite small business lenders.

For microloans, one of the best lenders is Kiva because there’s no interest or fees. That’s just one option though. Check out our picks for the best small business loans.

Disclaimer

At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.