Ondeck vs. Funding Circle Loans 2022

To choose between OnDeck and Funding Circle, just check out their interest rates and borrower qualifications.
Best for startups
OnDeck
OnDeck
3.1 out of 5 stars
3.1
  • Icon Yes  Light
    Starting at 35% APR
  • Icon Pros  Dark
    Direct lender
  • Icon Pros  Dark
    Lines of credit & term loans
  • Icon Pros  Dark
    600 min. credit score
Best for established businesses
  • Icon Yes  Light
    Starting at 6% interest
  • Icon Pros  Dark
    Lending marketplace
  • Icon Pros  Dark
    Term loans, lines of credit, & SBA loans
  • Icon Pros  Dark
    660 min. credit score

Data as of 1/24/22. Offers and availability may vary by location and are subject to change.

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OnDeck and Funding Circle are best for...

At a glance, OnDeck and Funding Circle can look pretty similar―which makes it hard to choose between them. Both OnDeck and Funding Circle are well-reviewed online lenders that offer term loans and lines of credit to business owners.

If you look a little deeper, though, you’ll start to see big differences―like financing options, interest rates, and borrower requirements―that can help you choose between these two alternative lenders.

Overall, OnDeck loans are easier to get, but Funding Circle loans cost less. But in this article, we’ll tell you all about what you need to consider before you apply for a loan with either of them.

OnDeck vs. Funding Circle 101

OnDeck vs. Funding Circle financing at a glance
Lender
Min./max. loan amount
Lowest listed rate
Min. credit score
Get funding
$5,000/$250,00035% APR600
$5,000/$500,0006% interest660

Data as of 1/24/22. Offers and availability may vary by location and are subject to change.

As we already mentioned, OnDeck and Funding Circle have quite a bit in common.

OnDeck and Funding Circle both fall into the category of online lenders (aka alternative lenders), and they both offer at least a couple business financing options. And business owners like them both―OnDeck and Funding Circle earn a 4.8 and 4.6 out of 5 on Trustpilot, respectively.1, 2

From there, though, things start to look pretty different.

Most funding options: Funding Circle

For starters, OnDeck is what we call a direct lender―meaning you apply for a loan, get funded, and make loan payments through OnDeck. But Funding Circle is a lending marketplace. That means that when you submit an application, Funding Circle shops around for you to find the best funding options you can qualify for. Then you can choose from those options and get funded through a partner lender.

Now, that might not seem like an important difference, but it actually matters a lot.

Because with direct lending through OnDeck, you get exactly two funding choices:

  • Term loan
  • Line of credit

But with marketplace lending through Funding Circle, you get slightly more funding options:

And while you submit just one application to Funding Circle, you can get considered for funding through several lenders.

In other words, Funding Circle gives you more potential loan options than OnDeck does.

Largest loan sizes: Funding Circle

Funding Circle doesn’t just give you more loan types, though―it also lets you get bigger loans.

In fact, Funding Circle loans max out at $500,000―twice as much as OnDeck’s maximum loan size of $250,000.  

Now, you may not need that much money. But if you’ve got a big project or purchase in mind, you might find that OnDeck loans (or especially its lines of credit) don’t give you enough money. 

Funding Circle has larger loans, making it better suited to those big funding needs.

Lowest borrower requirements: OnDeck

But the biggest difference between OnDeck and Funding Circle? Their minimum business loan requirements.

OnDeck vs. Funding Circle minimum borrower requirements
Lender
Min. time in business
Min. credit score
Min. revenue
Get funding
1 yr.600$100,000/yr.
2 yrs.660$500,000/yr.

Data as of 1/24/22. Offers and availability may vary by location and are subject to change.

Funding Circle expects a lot from its borrowers. You need to have at least a couple years in business under your belt, earn half a million in annual revenue, and have a personal credit score in the high 600s. Those are pretty high requirements for an online lender (but they’re much closer to what you’d see at a traditional lender like a bank).

OnDeck, on the other hand, has looser business loan requirements. You can apply with just one year in business, $100,000 in annual revenue, and a credit score of 600. Its typical borrower has higher qualifications (a revenue of $300,000 and a credit score of 650), but even those are lower than Funding Circle’s minimums.

Megaphone
Bad credit business loans

Both OnDeck and Funding Circle require at least a fair credit score. If you’ve got bad credit, we’ve found some business loans for bad credit that might work better for you.

So OnDeck has lower borrower requirements than Funding Circle, which makes OnDeck way better for younger, growing businesses and business owners with less-than-perfect credit. But older, more established businesses will want to take a closer look at Funding Circle.

Why? Simple: the loan costs.

Lowest loan costs: Funding Circle

OnDeck, like many online lenders, has relatively expensive financing. Its financing starts at 35% APR (annual percentage rate). That’s not outrageous for an alternative lender, but it’s way higher than you’d find at a bank or credit union.

Funding Circle, however, offers interest rates that can compete with traditional lenders. Its SBA term loans have starting rates of just 6% interest―one of the lowest rates we’ve seen from an online lender.

OnDeck vs. Funding Circle loan costs
Lender
Product
Lowest listed rate
Repayment term
Get funding
Line of credit35.9% APR12 mos.
Term loan35% APR 24 mos.
Term loanUnlisted6 mos.–5 yrs.
SBA 7(a) loan6% interest10 yrs.
Line of creditUnlistedN/A

Data as of 1/24/22. Offers and availability may vary by location and are subject to change.

Of course, Funding Circle’s loan costs can vary a lot from product to product. It (very annoyingly) no longer lists rates for its term loans or lines of credit, but those used to start at 4.99% interest and 9.99% APR, respectively. While we don’t know how much they cost now, we expect them to still be relatively affordable.

But with either lender, those are just starting rates. Your actual loan costs will depend on your borrower qualifications, loan size, and other factors.

(We also want to point out that a lower interest rate doesn’t always translate to a cheaper loan. A low interest rate with a very long term―like the ones offered by Funding Circle―can sometimes cost more than a higher rate with a short-term loan. Make sure you do the math before committing.)   

Even so, if you’re looking for the cheapest business loan, Funding Circle has a big edge over OnDeck.

Fastest funding times: OnDeck

Another difference worth noting? How long it takes to get funding.

While we like lending marketplaces like Funding Circle, they have their drawbacks too―especially when it comes to time. 

Funding Circle can take days to shop around for you, and then you still have to finalize your loan application after that. If you’re in a hurry to get funding, Funding Circle’s lending marketplace may be too slow for your needs.

OnDeck, on the other hand, can approve your application in just a few minutes (though we should note this isn’t guaranteed). And depending on the funding method you choose, you can even get your money the same day you apply.

So if you’re in a hurry, remember that OnDeck can get you funded faster than Funding Circle can.

The takeaway

To decide between Funding Circle and OnDeck, you really need to take a good look at your qualifications as a borrower―such as your credit score and business revenue.

If you’ve got high qualifications, then Funding Circle offers the better financing option. That’s thanks to its low starting interest rates and many funding options.

Business owners with lower qualifications (at least for now) will have better luck with OnDeck. It’s more expensive, yes, but OnDeck offers financing to borrowers that couldn’t qualify for Funding Circle loans.

Not ready to commit to either Funding Circle or OnDeck? Find alternative lending options with our list of the best small-business loans.

Related reading

Methodology

Before writing this comparison of OnDeck and Funding Circle, we used a standardized scoring process to grade each lender on their loan rates, borrower requirements, and other important factors. We used these scores to objectively see how they compared and come up with our recommendations.

OnDeck vs. Funding Circle FAQ

What credit bureau does OnDeck use?

OnDeck reports to three business credit bureaus: Experian, Equifax, and Paynet.

Is Funding Circle any good?

Yes, Funding Circle is a good lender. It has positive customer reviews (a 4.5 out of 5 on Trustpilot2), plenty of financing options, and low starting interest rates.

Because of its high borrower requirements, Funding Circle isn’t right for every business. If you can qualify, though, it’s a solid business lending marketplace.

What are OnDeck’s interest rates?

OnDeck loan rates start at 35% APR.

Note that that number is APR―not interest―so it includes both interest and loan fees (like origination fees). OnDeck doesn’t publish its interest rates.

And keep in mind that 35% is just OnDeck’s starting rate. Your rate could end up a lot higher, depending on your borrower qualifications, loan term, and other factors. 

What fees are charged to OnDeck borrowers?

In addition to interest, OnDeck charges an origination fee (between 0% and 5%) on its term loans and a $20 monthly maintenance fee on its lines of credit.

Sources

  1. Trustpilot, “OnDeck.” Accessed January 24, 2022.
  2. Trustpilot, “Funding Circle.” Accessed January 24, 2022.

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.

Chloe Goodshore
Written by
Chloe Goodshore
Chloe covers business financing and loans for Business.org. She has worked with many small businesses over the past 10 years, from video game stores to law firms. Those years watching frustrated business owners try to sift through their many options gave her a passion for breaking down complex business topics. She wants to help business owners spend less time agonizing over their businesses so they can spend more time running them.
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