Business Loan
What is a Business Loan or Funding and How Does it Work?
A business loan or funding is a financial arrangement in which a company secures a specific amount of capital from a lender—such as a bank, credit union, or online funder—for a defined period. The funds are typically used to support key business activities, including expansion, equipment purchases, working capital, or other operational needs.
Access to this type of funding can be critical for business growth, helping companies manage cash flow, invest in new opportunities, or navigate financial challenges. Before committing, it’s important for business owners to evaluate their financial position, the intended use of funds, and the terms offered by the lender.
Business loans and funding solutions can be applied across various areas, such as working capital, asset acquisition, real estate, and more.
Revenue-based financing offers an alternative for businesses with inconsistent cash flow or limited credit history. With repayments tied to revenue, this model provides greater flexibility and aligns the interests of both the business and the funding partner.
Flexible
Monthly/weekly payments
Scalable
Offers from $20k-$5M
Dependable
Over 30,000 small businesses funded
What Are the Advantages?
Access to Capital
Offers a reliable source of funding to support essential business operations and growth.
Business Expansion
Enables strategic initiatives such as opening new locations, entering new markets, or launching new products.
Capital Management
Helps manage daily operating costs, seasonal revenue shifts, and maintain consistent cash flow.
Ownership Retention
Provides funding without giving up equity, allowing owners to maintain full control of the business.
Minimum Requirements for Business Loans or Funding
- 6+ Months in business
- Fair/Good credit score
- $200k annual revenue
- U.S. Based business locations
FAQs
What is a business loan or funding?
A business loan* or funding is typically a funding in which a lump sum, upfront amount of cash is provided to the borrower (directly to the business). It is repaid on a regular basis with fixed payments over a fixed amount of time.
What are the pros and cons of a business loan or funding?
Pros
- A set, predictable payment schedule
- Flexibility of repayment terms
- Available from a variety of financing providers
Cons
- Repayment is guaranteed
- No fluctuation in payments as business revenue fluctuates
- May require a pledge of collateral
How do I qualify for a business loan or funding?
Minimum requirements are six months in business, at least $8,000 in monthly revenue; additional underwriting criteria will apply.
Where can I get a business loan or funding for challenged credit?
CBF, along with some other capital providers, offer traditional business loans. Given most of the underwriting is centered on the cash flow of the business, a lower personal credit score doesn’t mean you will not qualify for credit. However, this may impact the terms of the offer received which could include shorter term or higher pricing.
What do I need to know before I apply for this funding?
Once you apply and are approved, the benefit is funds may be available as soon as the same day or next business day. You should consider if during the evaluation process there will be soft or hard credit pulls and if there are early prepayment discounts. Repayments may be through automatic bank account deductions (ACH) and as long as you are consistent with your repayment history there could be additional capital available to you in the future.
When should my business consider this type of funding?
This type of financing is often successfully utilized for growth initiatives where the core business is stable and revenue is not subject to significant fluctuation.
How Small Businesses have Used Business Loans or Funding
Whether capturing new opportunities or managing seasonal variations, Capital Business Funding delivers customized financial solutions designed to help merchants succeed in today’s competitive market.