Business Loan Bad Credit

Bad credit doesn't disqualify you from business funding. While traditional banks require 720+ FICO, alternative lenders look at your business's actual financial health: monthly revenue, time in business, cash flow patterns, and industry. We approve businesses with FICO scores as low as 500 every day.

5 min read Updated May 2026 By Merchant Fund Express

Quick Answer

Merchant Fund Express provides fast business funding from $5,000 to $5,000,000 with 24-hour decisions. We accept FICO scores from 500, require no tax returns for amounts under 0,000, and fund within 1-3 business days. We have funded over 1,000 businesses across all 50 states with $50M+ in capital deployed.

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What Counts as Bad Credit?

FICO scores under 670 are typically called 'subprime' for personal credit. For business funding: 720+ is excellent (best rates), 670-719 is good (most lenders), 600-669 is fair (alternative lenders), 500-599 is poor (limited but real options). Below 500 is very limited.

Best Funding Options for Bad Credit

Merchant Cash Advance: 500+ FICO accepted, qualification based on card sales. Invoice Factoring: Based on your CUSTOMERS' credit, not yours. Equipment Financing: Equipment serves as collateral, looser credit requirements. Revenue-Based Financing: Approved on monthly revenue, not credit. We accept 500+ FICO on all four products.

Need Funding Now?

Apply in 4 minutes. Decision in 24 hours. 500+ FICO accepted, no tax returns under $250K.

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Rates to Expect with Bad Credit

MCAs: factor rates 1.30-1.45 (effective APR 50-150%). Equipment financing: 18-30% APR. Revenue-based financing: factor rates 1.25-1.40. Factoring fees: 2-5% per 30 days. The lower your FICO, the higher the cost — that's why we encourage rebuilding business credit alongside funding.

How to Improve Your Approval Odds

1) Show 6+ months of consistent monthly revenue. 2) Maintain positive average daily bank balance. 3) Avoid NSFs (overdrafts) — they kill applications. 4) Limit MCAs already on the books (max 1-2). 5) Have your tax ID, bank statements, and ID ready. 6) Apply during a strong revenue month.

Frequently Asked Questions

Everything you need to know before you apply.

What's the lowest FICO you'll fund?

We approve down to 500 FICO on most products. Below 500 we look at compensating factors — strong revenue, time in business, and clean recent banking history can sometimes get an exception.

Will applying hurt my credit?

No. Pre-qualification is a soft credit pull — zero impact to your FICO. Hard pulls only happen at funding, with your written authorization.

Can I get a business loan with no credit?

Yes — through invoice factoring (based on customers' credit) or revenue-based financing (based on monthly deposits). MCAs also approve on revenue alone in many cases.

How long does it take to fund someone with bad credit?

Same as good credit: decision in 24 hours, funds in 1-3 days. Bad credit doesn't slow us down — it just affects rates.

Will repaying improve my business credit?

Most MCAs do NOT report to bureaus. Term loans and equipment financing usually do report — paying on time builds business credit and qualifies you for cheaper funding next time.