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Retail Business Loans: Best Options and How to Get One

By Randa Kriss
Last updated on August 20, 2024
Edited bySally Lauckner
✅Fact checked and reviewed
Retail business loans are available from banks, SBA lenders and online lenders.

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Retail business loans provide financing to retail businesses, such as supermarkets, clothing stores and gas stations. Retailers can use these small-business loans to manage, upgrade and grow their operations. The best retail loan for your business is the most affordable one you can qualify for that meets your needs.
Below, compare our top options for retail business loans and learn more about how to get one.

How much do you need?

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are 7 of the best retail business loans

LenderNerdWallet Rating▼Max loan amount▼Min. credit score▼Next steps

OnDeck - Line of credit

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5.0/5

Best for Working capital needs

$100,000625

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Fundbox - Line of credit

Read Review
4.9/5

Best for Startups

$150,000600
Read Review

Bank of America Business Advantage Unsecured Term Loan

Read Review
4.8/5

Best for Low interest rates

Undisclosed700
Read Review

Fora Financial - Online term loan

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4.5/5

Best for Bad credit

$1,500,000570

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National Funding - Equipment Financing

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4.2/5

Best for Equipment financing

$150,000600

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SBA 7(a) loan

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Best for Large loan amounts

$5,000,000650

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PayPal Working Capital Loan

Read Review

Best for PayPal users

$250,000300
Read Review

Here are 7 of the best retail business loans

Best for Working capital needs

OnDeck

Max Amount

$100,000

Min. Credit Score

625

Best for Startups

Fundbox

Max Amount

$150,000

Min. Credit Score

600

Read Review

Best for Low interest rates

Bank of America

Max Amount

Undisclosed

Min. Credit Score

700

Read Review

Best for Bad credit

Fora Financial

Max Amount

$1,500,000

Min. Credit Score

570

Best for Equipment financing

National Funding

Max Amount

$150,000

Min. Credit Score

600

Best for Large loan amounts

U.S. Small Business Administration

Max Amount

$5,000,000

Min. Credit Score

650

Best for PayPal users

PayPal

Max Amount

$250,000

Min. Credit Score

300

Read Review

I'M INTERESTED IN:

Our pick for

Working capital needs

OnDeck’s line of credit can provide working capital up to $100,000. This credit line can help you buy additional inventory during your busy season or cover overhead costs during a seasonal slow.

OnDeck - Line of credit

5.0
NerdWallet rating 
Read Review

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Max Loan Amount
$100,000
Min. credit score
625
Est. APR
35.90-84.90%
OnDeck offers a fast line of credit for small-business owners with less-than-stellar credit who need to manage cash flow or buy inventory.
May fund quickly
5.0
NerdWallet rating 

Max loan

$100,000

Min. Credit score

625

Apr range

35.90-84.90%

OnDeck offers a fast line of credit for small-business owners with less-than-stellar credit who need to manage cash flow or buy inventory.
Read Review

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Our pick for

Startups

Fundbox offers flexible funding for retail stores that have been in operation for at least six months.

Fundbox - Line of credit

4.9
NerdWallet rating 
Read Review
Max Loan Amount
$150,000
Min. credit score
600
Est. APR
36.00-99.00%
Fundbox offers a business line of credit to fill a cash flow gap, and qualifying is easier than with other lenders.
May fund quickly
4.9
NerdWallet rating 

Max loan

$150,000

Min. Credit score

600

Apr range

36.00-99.00%

Fundbox offers a business line of credit to fill a cash flow gap, and qualifying is easier than with other lenders.
Read Review

Our pick for

Low interest rates

Bank of America’s unsecured term loan offers low interest rates and competitive repayment terms. It can be a good option for established retail businesses that want to upgrade their physical location, purchase new equipment or open a new store.

Bank of America Business Advantage Unsecured Term Loan

4.8
NerdWallet rating 
Read Review
Max Loan Amount
Undisclosed
Min. credit score
700
Bank of America’s term loan offers competitive interest rates and flexible repayment terms — with no collateral required.
4.8
NerdWallet rating 

Max loan

Undisclosed

Min. Credit score

700

Bank of America’s term loan offers competitive interest rates and flexible repayment terms — with no collateral required.
Read Review

Our pick for

Bad credit

Fora Financial provides funding up to $1.5 million that can be used for purchasing supplies, upgrading technology, investing in marketing or hiring sales associates. You may be able to qualify with a minimum credit score of 570 or higher.

Fora Financial - Online term loan

4.5
NerdWallet rating 
Read Review

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Max Loan Amount
$1,500,000
Min. credit score
570
Fora Financial can be a good fit for borrowers who may fall short of qualifying for traditional bank financing or young but established small businesses looking for speedy financing.
4.5
NerdWallet rating 

Max loan

$1,500,000

Min. Credit score

570

Fora Financial can be a good fit for borrowers who may fall short of qualifying for traditional bank financing or young but established small businesses looking for speedy financing.
Read Review

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Our pick for

Equipment financing

If you need to purchase equipment for your retail business, National Funding issues equipment loans up to $150,000.

National Funding - Equipment Financing

4.2
NerdWallet rating 
Read Review

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Max Loan Amount
$150,000
Min. credit score
600
Borrowers who can't qualify for more traditional loan options might consider National Funding for fast access to capital.
4.2
NerdWallet rating 

Max loan

$150,000

Min. Credit score

600

Borrowers who can't qualify for more traditional loan options might consider National Funding for fast access to capital.
Read Review

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Our pick for

Large loan amounts

SBA 7(a) loans can provide up to $5 million in funding. So far in fiscal year 2024, 11.3% of all 7(a) loans have been issued to businesses in the retail industry.

SBA 7(a) loan

Read Review

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Max Loan Amount
$5,000,000
Min. credit score
650
Est. APR
11.50-15.00%
7(a) loans are issued by private lenders and backed by the SBA. They offer long repayment terms and low interest rates.
Lowest interest rate

Max loan

$5,000,000

Min. Credit score

650

Apr range

11.50-15.00%

7(a) loans are issued by private lenders and backed by the SBA. They offer long repayment terms and low interest rates.
Read Review

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Our pick for

PayPal users

If your retail business uses PayPal to process sales, you may be able to get a PayPal Working Capital loan. This funding is repaid as a percentage of your PayPal sales, with a minimum repayment every 90 days.

PayPal Working Capital Loan

Read Review
Max Loan Amount
$250,000
Min. credit score
300
The PayPal Working Capital loan can help low-revenue business owners (with a PayPal account) access fast financing.

Max loan

$250,000

Min. Credit score

300

The PayPal Working Capital loan can help low-revenue business owners (with a PayPal account) access fast financing.
Read Review

How Much Do You Need?

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What is a retail business loan?

A retail business loan is a type of financing that’s used to manage or grow your retail business. These loans can be used to:
  • Purchase inventory or equipment.
  • Make payroll.
  • Hire new employees.
  • Pay for utilities and other day-to-day expenses.
  • Launch marketing or advertising campaigns.
  • Upgrade your technology.
  • Expand your online presence.
  • Improve or expand your physical location.

Types of retail business loans

Many different types of business loans can be used to fund your retail store. Common options include:

Business term loans

With a business term loan, you borrow a lump sum of money from a lender and repay it, with interest, over a specific period of time. Term loans can be good for one-time specific investments in your business.
If you have a larger project, you might prefer a long-term business loan to spread your total costs over a longer time period. Short-term business loans, on the other hand, are better for immediate financing needs.

Business lines of credit

Business lines of credit are more flexible than term loans. A business line of credit allows you to draw from a set amount of funds and only pay interest on the money you draw. When you’ve repaid what you’ve borrowed, you can continue to draw on the credit line.
As a result, business lines of credit are good for managing cash flow needs and covering everyday expenses. They can also serve as an emergency fund.

🤓 Nerdy Tip

If you need to buy inventory for your retail business, you might consider inventory financing. With inventory financing, the products you buy serve as collateral on the loan, making it easier to qualify for than more traditional loan options. Inventory financing is available as a term loan or line of credit.

SBA loans

SBA loans are issued by participating lenders, like banks and credit unions, and partially guaranteed by the U.S. Small Business Administration.
The most popular SBA loan, the 7(a) loan, can be used for a variety of purposes — making it a good option for the wide-ranging needs of retail businesses. SBA 7(a) loans are available as term loans and lines of credit.

Equipment financing

Equipment financing is used specifically for buying new or used equipment for your business. These loans typically function like term loans — in which you borrow funds and repay them over time, with interest.
Because the equipment you purchase serves as collateral on the loan, however, equipment financing can be easier to qualify for than some other loan options.

Merchant cash advances

A merchant cash advance, or MCA, isn’t technically a loan. Instead, an MCA company gives you an upfront sum of capital that you repay using a percentage of your debit and credit card sales, plus a fee.
MCAs are usually fast to fund and easy to qualify for — and can be well suited for retail businesses that have substantial debit and credit card sales. Keep in mind, however, that MCAs are often expensive, with APRs reaching triple digits, so you’ll likely want to consider other options before turning to an MCA.

Where to get retail business loans

Retail business loans are available from both traditional and online lenders.

Banks and credit unions

Banks and credit unions will typically offer retail business loans with the lowest interest rates and most competitive repayment terms. To qualify, however, you’ll likely need to be an established business with good credit. Bank loans can take anywhere from several days to several weeks to fund.
Some banks and credit unions are also SBA lenders. SBA loans offer long repayment terms and competitive interest rates. Although SBA loans can be slightly easier to qualify for compared to traditional bank loans, you’ll still need to meet strict criteria to get funding. And like bank loans, SBA loans are slow to fund.
» MORE: How long does it take to get an SBA loan?

Online lenders

Online or private business lenders tend to offer greater flexibility compared to banks and credit unions. These lenders typically have more lenient qualification requirements and may work with startups or borrowers with bad credit.
Online lenders also offer streamlined applications with minimal documentation. Some lenders can provide funding in just 24 hours. As a result of this speed and flexibility, however, online lenders often charge higher interest rates.

How to get a retail business loan

To get a retail business loan, you can follow these steps:

1. Evaluate your financing needs

Think about how much business capital you need and how you plan to use it. If you’re looking for ongoing access to funds, for example, a working capital line of credit may be the best option. If you need to purchase inventory, on the other hand, you might consider inventory financing.
In any case, you should also make sure that you can afford to take on any potential debt. A business loan calculator can help you estimate payments and total loan costs.

2. Review your qualifications

Most lenders will use a standard set of criteria — personal credit score, annual revenue, time in business — to underwrite your loan application. It can be helpful to know where you stand on these metrics before submitting your application.
Keep in mind that lenders may also consider factors like your cash flow, available collateral and existing debt obligations.

3. Compare lenders

You’ll want to research several different small-business lenders to find the right one for your needs. As you compare your options, you should consider factors such as:
  • Loan types.
  • Maximum loan amounts.
  • Repayment terms and schedule.
  • Interest rates and fees..
  • Funding speed.
  • Application process.
  • Lender reputation.
It can also be useful to read online reviews to get a better sense of what it’s like to work with a particular lender.

4. Gather your documentation and apply

Although the business loan application process varies from lender to lender, you’ll generally be asked to provide the following:
  • Basic information about you and your business.
  • Personal and business bank statements.
  • Personal and business tax returns.
  • Business financial statements.
  • A description of your collateral.
  • Existing debt obligations, if applicable.
If you’ve applied with an online lender, you may be able to receive approval and funding by the next business day. Banks and SBA lenders, on the other hand, may take up to several weeks.

Ready to get funding for your retail business?

Last updated on August 20, 2024

Methodology

NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer small-business friendly features, including:
- Transparency of rates and terms. - Flexible payment options. - Fast funding times. - Accessible customer service. - Reporting of payments to business credit bureaus. - Responsible lending practices.
We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodology for small-business loans and our editorial guidelines.

Wondering if you qualify?

It’s possible to get a business loan even if you have bad credit. Bad-credit business loans are available from alternative sources, like online or nonprofit lenders.

See Your Loan Options