What are business loans and how do they work?

Business loans provide funding that helps companies grow, manage cash flow, and invest in operations. Whether you're launching a startup or expanding an established business, financing options include term loans, lines of credit, equipment loans, and government-backed U.S. Small Business Administration (SBA) loans.

Business loans can be accessed through banks, online lenders, and digital marketplaces that connect borrowers to multiple loan offers through one streamlined application. Platforms like Lendio simplify the process by letting business owners compare loan terms, interest rates, and approval timelines across different lenders, all in one place.

What is a business loan marketplace?

Business loan marketplaces have partnerships with multiple lenders, all of which market their financial products on a single platform. These platforms exist for the benefit of small business owners and consumers, who can:

• Compare multiple business loan offers in one place
• Use the loan marketplace to compare rates, financing options, and lender terms
• Apply for multiple funding options with a single loan application

Why are business loan marketplaces more important than ever?

Business loan marketplaces like Lendio make it easier for applicants to get the business funding they need. They do this by:

• Letting business owners compare multiple financing options at once
• Providing clarity when it comes to finding a business loan with the best rates and terms
• Saving loan applicants time and legwork as they search for the right funding options

How do Lendio business loans work?

Lendio business loans come in many different forms, but they can include:

• Term loans, lines of credit, SBA loans, equipment financing, invoice factoring, merchant cash advances, and other loan types
• Financing options up to $5 million, depending on the loan type
• Loans with various repayment terms, including fixed-term options or payments based on unpaid invoices or a percentage of sales

What are the most common Lendio loan requirements?

While eligibility requirements for business loans can vary by loan type and lender, common requirements for funding include:

• Minimum business duration (6 months or more; SBA typically 2 years)
• Credit scores: ~560–680, depending on the product
• Annual revenue thresholds (often $50,000–$250,000)
• Some loans may need collateral or personal guarantees

Important note: Lendio lets applicants gauge their approval odds and see which types of funding they may be eligible for without any credit score impact. This means you can fill out basic information and see if you are close to meeting eligibility requirements for various lenders before you apply.

Is Lendio a reputable, legitimate, and safe company?

Lendio is a reputable, legitimate lending platform that connects borrowers to the best business lenders in operation. Current Lendio stats include:

• Excellent rating on Trustpilot: The company has a current rating of 4.7 out of 5 stars across more than 21,000 user reviews.
• Solid reviews with the BBB: Although Lendio is not accredited with the Better Business Bureau, the platform boasts mostly positive reviews here.
• Limited complaints: We did not find any registered complaints about Lendio in the Consumer Financial Protection Bureau (CFPB) Consumer Complaint Database.

What are the pros and cons of using Lendio?

Lendio offers businesses a convenient way to access funding from a wide range of lenders through one streamlined platform. However, there are also important considerations to keep in mind when deciding whether to use a business loan marketplace like Lendio.

Pros of using Lendio:

• Access over 75 lenders with a single application, saving time and effort
• Offers a wide variety of loan types, including SBA loans, equipment financing, and business lines of credit
• Fast prequalification process with no initial hard credit check
• No additional fees for borrowers—Lendio is paid by its lending partners
• High user satisfaction, with strong reviews on platforms like Trustpilot

Cons of using Lendio:

• Some users report receiving multiple follow-ups or sales calls from lenders after they apply
• Prequalified offers may not always match final terms after underwriting
• Actual funding decisions and timelines vary by partner lender, not Lendio
• Borrowers must carefully review loan terms and conditions before committing

What steps should I take to apply for a business loan through Lendio?

The following steps can help you get the funding you need for your business through Lendio and other business loan platforms.

• Step 1: Gather important documents. Gather the documentation you'll need to apply for a business loan. This includes your personal and business tax returns, business financials, business plan, and more.
• Step 2: Complete one online application on Lendio. Fill out a basic loan application on Lendio and get matched with several lending partners that meet your funding needs.
• Step 3: Compare lenders. Review business loan offers based on their interest rates, repayment terms, and loan fees.
• Step 4: Apply for a loan. Once you are comfortable with a specific loan offer, you can submit a full application and proceed.
• Step 5: Get funded. Await the lender’s credit check and final decision on your loan, then wait for funding to show up in your business bank account.