A business line of credit (LOC) is a flexible financing solution that allows businesses to borrow funds up to a certain limit, repay, and borrow again. It's especially valuable for startups dealing with unpredictable cash flow, unexpected expenses, or rapid growth needs.
Why Startups Need a Line of Credit
Startups often struggle with inconsistent revenue, delayed client payments, or the need to invest in marketing, hiring, or inventory. A line of credit provides access to revolving capital, ensuring founders can act on opportunities or solve problems without waiting for outside funding.
Benefits of a Startup Line of Credit
- Flexible Access to Cash: Draw funds only when needed.
- Builds Business Credit: Timely repayment improves creditworthiness.
- Supports Growth: Invest in marketing, product development, or operations.
- Improves Cash Flow: Helps cover payroll, rent, and inventory gaps.
- No Need for Equity: Keep full ownership without giving up shares.
Top Considerations for Startup Credit Lines
- Minimum Time in Business: Some lenders require at least 6–12 months of operations.
- Annual Revenue: Many require $50,000–$100,000 minimum annual income.
- Credit Score: Startups with founders having 600+ personal credit scores have better approval chances.
- Speed of Funding: Choose lenders with quick approval processes and fast fund disbursement.
- Fees: Watch for draw fees, origination fees, and monthly maintenance charges.
Best Business Line of Credit Providers for Startups in 2025
| Provider | Credit Limit | Interest Rate | Minimum Requirements | Key Features |
|---|---|---|---|---|
| BlueVine | Up to $250,000 | 6.2% – 35% | 6+ months in business, $120K+ revenue | Fast approvals, weekly/monthly repayment, no origination fee |
| Fundbox | Up to $150,000 | 4.66% – 25% (12-24 week terms) | 6+ months in business, $100K+ revenue | Low barrier to entry, quick funding, integrates with accounting tools |
| OnDeck | $6,000 – $100,000 | 29.9% – 65% | 1+ year in business, $100K+ revenue | Same-day funding, no prepayment penalty, transparent terms |
| Kabbage by American Express | $2,000 – $250,000 | 9% – 36% APR | 12+ months in business, $50K+ revenue | Automated application, quick decisions, easy access via app |
| Credibly | Up to $250,000 | Starting at 15% | 6+ months in business, $15K/month revenue | Prequalification with soft credit check, flexible draw options |
Who Should Use a Business Line of Credit?
Startup lines of credit are best for:
- Early-stage companies needing working capital
- Startups with unpredictable cash flow cycles
- Founders who want to avoid giving up equity
- Companies planning for marketing, hiring, or equipment investment
How to Get Approved as a Startup
- Improve your personal credit score (aim for 600+)
- Connect accounting software or business bank accounts
- Show consistent monthly revenue
- Minimize existing debt and liabilities
- Apply to lenders that specialize in startups and fintech solutions
Final Thoughts
Securing a business line of credit as a startup can provide the cash flexibility you need to grow and thrive. With fintech lenders offering competitive rates and streamlined applications, it's easier than ever to get started. Carefully compare providers based on speed, requirements, fees, and features to find the best credit line for your startup in 2025.
Frequently Asked Questions
1. Can a new startup get a business line of credit?
Yes, some lenders offer credit lines to startups with just 6 months in business and modest revenue, especially fintech providers like Fundbox and BlueVine.
2. What’s the minimum credit score for a startup line of credit?
Most lenders require a personal credit score of 600 or higher, though some may accept slightly lower scores for strong revenue or bank statements.
3. How quickly can I access funds?
Fintech lenders like Fundbox or OnDeck can deliver funds within 24–48 hours after approval.
4. Is a business credit line better than a term loan for startups?
If your startup needs flexible access to capital over time rather than a lump sum, a line of credit is usually the better option.
5. Will applying for a credit line hurt my credit?
Some lenders allow you to prequalify with a soft credit pull. A hard credit check typically occurs only when you accept the offer.