2023’s Top Alternative Lending Sources for Small Businesses

As a small business owner, you may need a loan to finance your business operations. However, traditional banks may not always be the best option for obtaining financing. Fortunately, there are alternative lending sources that can help small businesses secure the funds they need to grow and thrive.

In 2023, there are several alternative small business lenders to cater small business loans. These alternative lending sources offer a variety of loan products that cater to different business needs. Whether you need a loan to purchase equipment, hire employees, or expand your business, there is an alternative lending source that can help.

When searching for the best alternative small business lenders, it’s important to consider factors such as interest rates, loan terms, and repayment options. By doing your research and comparing different lending sources, you can find the best loan product that fits your business needs and financial goals.

Section 1: Peer-to-Peer Alternative Lending

Peer-to-peer (P2P) lending is a popular alternative lending source for small businesses that need access to funds. P2P lending platforms connect borrowers with investors who are willing to lend money at competitive interest rates. These platforms have become increasingly popular in recent years, as they offer a streamlined application process and quick funding times.

One of the biggest advantages of P2P lending is that it allows small businesses to bypass traditional lenders, such as banks, which may have stricter lending requirements. P2P lenders also offer more flexibility in terms of loan amounts and repayment terms, making it easier for small businesses to find a loan that fits their specific needs.

Here are the top 20 P2P  alternative small business lenders:

Section 2: Crowdfunding

Crowdfunding is a popular alternative lending source for small businesses that allows them to raise funds from a large number of people through online platforms. Crowdfunding can be an excellent option for businesses that have a unique product or idea that can generate interest among the public. It is also an excellent way to validate a product or idea before investing a lot of money into it.

There are three main types of crowdfunding: donation-based, reward-based, and equity-based. Donation-based crowdfunding involves raising funds without offering anything in return. Reward-based crowdfunding involves offering a reward to backers who pledge a certain amount of money. Equity-based crowdfunding involves offering shares of the company in exchange for funding.

Here are the top 20 crowdfunding platforms for small businesses:

LenderDescriptionWebsite
LendingClubOne of the largest P2P lenders, offering loans up to $500,000.https://www.lendingclub.com/
ProsperOffers loans up to $400,000 with competitive rates and flexible repayment terms.https://www.prosper.com/
Funding CircleSpecializes in small business loans up to $500,000 with fast funding times.https://www.fundingcircle.com/
KabbageOffers lines of credit up to $250,000 with a quick and easy application process.https://www.kabbage.com/
OnDeckOffers loans up to $500,000 with a simple application process and fast funding times.https://www.ondeck.com/
StreetSharesSpecializes in small business loans and lines of credit for veterans.https://streetshares.com/
CrediblyOffers loans up to $400,000 with flexible repayment terms and a quick application process.https://www.credibly.com/
FundboxOffers lines of credit up to $150,000 with a simple application process and fast funding times.https://fundbox.com/
BlueVineOffers lines of credit up to $250,000 with competitive rates and fast funding times.https://www.bluevine.com/
UpstartOffers loans up to $50,000 with competitive rates and flexible repayment terms.https://www.upstart.com/
PeerformOffers loans up to $25,000 with competitive rates and flexible repayment terms.https://www.peerform.com/
AvantOffers loans up to $35,000 with competitive rates and flexible repayment terms.https://www.avant.com/
SoFiOffers loans up to $100,000 with competitive rates and flexible repayment terms.https://www.sofi.com/
LoanBuilderOffers loans up to $500,000 with a quick and easy application process.https://loanbuilder.com/
PayPal Working CapitalOffers loans up to $500,000 to PayPal users with flexible repayment terms.
KickstarterReward-based crowdfunding platform for creative projects.https://www.kickstarter.com/
IndiegogoReward-based crowdfunding platform for creative and entrepreneurial projects.https://www.indiegogo.com/
GoFundMeDonation-based crowdfunding platform for personal and charitable causes.https://www.gofundme.com/
SeedInvestEquity-based crowdfunding platform for startups and early-stage companies.https://www.seedinvest.com/
StartEngineEquity-based crowdfunding platform for startups and small businesses.https://www.startengine.com/
RepublicEquity-based crowdfunding platform for startups and small businesses.https://republic.co/
WefunderEquity-based crowdfunding platform for startups and small businesses.https://wefunder.com/
Crowd SupplyReward-based crowdfunding platform for hardware projects.https://www.crowdsupply.com/
FundableReward-based and equity-based crowdfunding platform for startups and small businesses.https://www.fundable.com/
CircleUpEquity-based crowdfunding platform for consumer and retail companies.https://circleup.com/
MicroVenturesEquity-based crowdfunding platform for startups and small businesses.https://microventures.com/
NextSeedDebt-based crowdfunding platform for small businesses.https://www.nextseed.com/
StreetSharesDebt-based crowdfunding platform for veteran-owned small businesses.https://streetshares.com/
LendingClubPeer-to-peer lending platform for personal and small business loans.https://www.lendingclub.com/
ProsperPeer-to-peer lending platform for personal and small business loans. Invoice financing and business https://www.prosper.com/

Section 3: Microloans

Microloans are small loans typically ranging from $500 to $50,000 that are designed to help new entrepreneurs and borrowers with limited credit access capital. These loans are often provided by non-profit organizations, community development financial institutions, and other alternative lenders.

Microloans are a great option for small business owners who need a small amount of capital to start or expand their business. These loans can be used for a variety of purposes, including purchasing inventory, equipment, or supplies, or covering operating expenses.

Here are the top 20 alternative lenders offering microloans:

LenderLoan AmountsInterest RatesWebsite
KivaUp to $15,0000%https://www.kiva.org/
AccionUp to $50,0008% to 22%https://us.accion.org/
Opportunity FundUp to $250,0008.99% to 22.99%https://www.opportunityfund.org/
Grameen AmericaUp to $100,00016% to 18%https://www.grameenamerica.org/
Acción EastUp to $50,0008% to 22%https://www.accion.org/
Justine PETERSENUp to $50,0006% to 12%https://www.justinepetersen.org/
VEDCUp to $250,0008.99% to 22.99%https://vedc.org/
Working SolutionsUp to $50,0007% to 12%https://www.workingsolutions.org/
PeopleFundUp to $350,0006.5% to 14%https://peoplefund.org/
WECO FundUp to $50,0006% to 12%https://www.wecofund.org/
Women’s Business CenterUp to $50,0008% to 14%https://www.womensbusinesscenter.org/
Latino Economic Development CenterUp to $250,0008.99% to 22.99%https://ledcmetro.org/
Community Development Financial Institution FundUp to $5 millionVarieshttps://www.cdfifund.gov/
Association for Enterprise OpportunityUp to $50,000Varieshttps://www.aeoworks.org/
Section 4: Invoice Financing

Invoice financing is a type of alternative lending that allows small businesses to receive cash advances based on the value of their outstanding invoices. This type of financing is particularly useful for businesses that have long payment terms with their customers and need immediate cash flow. Here are some of the top invoice financing lenders:

LenderDescriptionWebsite
FundboxFundbox offers invoice financing with credit lines up to $100,000. They have a simple application process and fast funding.https://fundbox.com/
BlueVineBlueVine offers invoice factoring and lines of credit up to $5 million. They have a quick and easy online application process.https://www.bluevine.com/
Funding CircleFunding Circle offers invoice financing and term loans up to $500,000. They have a simple application process and fast funding.https://www.fundingcircle.com/us/
Bibby Financial ServicesBibby Financial Services offers invoice financing and factoring with credit lines up to $10 million. They have a global presence and specialize in industries such as transportation and logistics.https://www.bibbyusa.com/
Blue Ridge BankBlue Ridge Bank offers invoice financing with credit lines up to $5 million. They have a fast and easy application process and specialize in providing financing to government contractors.https://www.mybrb.com/

Other top invoice financing lenders include Kabbage, Behalf, and C2FO. It’s important to compare rates and terms from multiple lenders to find the best option for your business.

Section 5: Merchant Cash Advances

Merchant cash advances (MCA) are a type of alternative lending that is based on future credit card sales. The lender provides a lump sum payment in exchange for a percentage of daily credit card sales. The percentage is typically between 10% and 20% of the daily sales until the loan is repaid in full. MCAs are a popular option for businesses that need quick access to cash but have poor credit or limited collateral.

Here are the top 20 alternative lenders that offer merchant cash advances:

Section 6: Equipment Financing

Equipment financing is a type of loan that allows small businesses to purchase or lease equipment they need to operate. This type of financing can be a great option for small business owners who need to purchase or upgrade equipment but do not have the cash on hand to do so.

There are many lenders that offer equipment financing to small businesses. Here are the top 20 alternative lenders for equipment financing:

Lender NameDescriptionWebsite
United Capital SourceOffers MCAs with funding up to $5 million and flexible repayment terms.https://www.unitedcapitalsource.com/
Rapid FinanceOffers MCAs with funding up to $1 million and a quick application process.https://www.rapidfinance.com/
OnDeckOffers MCAs with funding up to $500,000 and a simple application process.https://www.ondeck.com/
BlueVineOffers MCAs with funding up to $250,000 and a quick application process.https://www.bluevine.com/
Funding CircleOffers MCAs with funding up to $500,000 and a simple application process.https://www.fundingcircle.com/
FundboxOffers MCAs with funding up to $100,000 and a quick application process.https://fundbox.com/
KabbageOffers MCAs with funding up to $250,000 and a quick application process.https://www.kabbage.com/
PayPal Working CapitalOffers MCAs with funding up to $500,000 and a quick application process for PayPal users.https://www.paypal.com/us/webapps/workingcapital/
CrediblyOffers MCAs with funding up to $400,000 and flexible repayment terms.https://www.credibly.com/
Fora FinancialOffers MCAs with funding up to $500,000 and a simple application process.https://www.forafinancial.com/
National FundingOffers MCAs with funding up to $500,000 and a quick application process.https://www.nationalfunding.com/
Crest CapitalOffers MCAs with funding up to $1 million and flexible repayment terms.https://www.crestcapital.com/
ForwardLineOffers MCAs with funding up to $250,000 and a simple application process.https://www.forwardline.com/
Merchant GrowthOffers MCAs with funding up to $500,000 and flexible repayment terms.https://www.merchantgrowth.com/
Reliant Funding
Reliant Funding
Offers MCAs with funding up to $500,000 and a quick application process.https://www.reliantfunding.com/
Can Capital
LenderDescriptionWebsite
1. Balboa CapitalBalboa Capital offers equipment financing for a wide range of industries.https://www.balboacapital.com/
2. Crest CapitalCrest Capital offers equipment financing and leasing for businesses of all sizes.https://www.crestcapital.com/
3. National FundingNational Funding offers equipment financing and leasing for a variety of industries.https://www.nationalfunding.com/
4. Currency CapitalCurrency Capital offers equipment financing and leasing for businesses of all sizes.https://www.currencycap.com/
5. Funding CircleFunding Circle offers equipment financing and leasing for businesses in various industries.https://www.fundingcircle.com/us/
6. KabbageKabbage offers equipment financing and leasing for businesses of all sizes.https://www.kabbage.com/
7. OnDeckOnDeck offers equipment financing and leasing for businesses in various industries.https://www.ondeck.com/
8. BlueVineBlueVine offers equipment financing and leasing for businesses in various industries.https://www.bluevine.com/
9. LendioLendio offers equipment financing and leasing for businesses of all sizes.https://www.lendio.com/
10. SmartBizSmartBiz offers equipment financing and leasing for businesses in various industries.https://www.smartbizloans.com/
11. CrediblyCredibly offers equipment financing and leasing for businesses in various industries.https://www.credibly.com/
12. FundboxFundbox offers equipment financing and leasing for businesses of all sizes.https://fundbox.com/
13. Fora FinancialFora Financial offers equipment financing and leasing for businesses in various industries.https://www.forafinancial.com/
14. Rapid FinanceRapid Finance offers equipment financing and leasing for businesses in various industries.https://www.rapidfinance.com/
15. BFS CapitalBFS Capital offers equipment financing and leasing for businesses of all sizes.https://www.bfscapital.com/
16. AmerifundAmerifund offers equipment financing and leasing for businesses in various industries.https://www.amerifund.cc/
Section 7: Conclusion 

Small business owners often struggle to secure traditional bank loans due to strict eligibility requirements and a lengthy approval process. Alternative lending sources can provide quick and flexible financing options to help small businesses grow and thrive. In this article, we have explored some of the best alternative lending sources for small business loans in 2023.

Whether you need a short-term loan, a long-term loan, or a line of credit, there are many lenders to choose from. It’s important to do your research and compare rates and terms to find the best option for your business needs.

Below is a list of the top 20 alternative lenders with a brief description of each one:

LenderDescriptionWebsite
BlueVineOffers lines of credit and invoice factoring for small businesseshttps://www.bluevine.com/
OnDeckProvides short-term loans and lines of credit to small businesseshttps://www.ondeck.com/
FundboxOffers lines of credit and invoice financing to small businesseshttps://fundbox.com/
Funding CircleProvides term loans and lines of credit to small businesseshttps://www.fundingcircle.com/us/
SmartBizOffers SBA loans and term loans to small businesseshttps://www.smartbizloans.com/
Tab BankProvides term loans and lines of credit to small businesseshttps://www.tabbank.com/
PNCOffers lines of credit and term loans to small businesseshttps://www.pnc.com/en/small-business.html
Credibility CapitalProvides term loans to small businesseshttps://www.credibilitycapital.com/
National FundingOffers term loans and equipment financing to small businesseshttps://www.nationalfunding.com/
KabbageProvides lines of credit to small businesseshttps://www.kabbage.com/
QuarterSpotOffers short-term loans and lines of credit to small businesseshttps://www.quarterspot.com/
LoanBuilderProvides short-term loans and lines of credit to small businesseshttps://www.loanbuilder.com/
Rapid FinanceOffers term loans and lines of credit to small businesseshttps://www.rapidfinance.com/
Fora FinancialProvides working capital loans and merchant cash advances to small businesseshttps://www.forafinancial.com/
Merchant MaverickOffers a comparison of various alternative lenders for small business loanshttps://www.merchantmaverick.com/
FunderaProvides a comparison of various lenders for small business loanshttps://www.fundera.com/
LendioOffers a marketplace for various lenders to compete forhttps://www.lendio.com/