A business line of credit (often called a company credit line or business LOC) is one of the most flexible financing tools available to U.S. small and medium-sized businesses. It functions like a credit card for your company: you get approved for a maximum limit, draw funds only when needed, and pay interest solely on the amount used.
In February 2026, with the Prime Rate around 6.75%, business lines of credit offer a practical way to handle cash flow fluctuations, cover short-term expenses, manage inventory, or seize growth opportunities without reapplying for new loans each time.
This comprehensive guide covers how business lines of credit work, current rates and terms, eligibility requirements, the application process, top providers, and tips to secure the best deal.
What Is a Business Line of Credit?
A business line of credit provides revolving credit up to an approved limit. You can draw funds as needed (via transfers, checks, or linked cards), repay what you borrow, and borrow again — all within the limit and term.
Key features:
- Revolving — Reuse available credit after repayment
- Interest only on drawn amount — No cost for unused portion
- Secured (backed by collateral like assets or cash) or unsecured (based on credit and revenue)
- Variable or fixed rates — Most are variable, tied to Prime
Unlike term loans, it offers ongoing flexibility without fixed monthly principal payments (though minimum payments are usually required).
Why Get a Business Line of Credit in 2026?
- Manage seasonal cash flow or unexpected expenses
- Avoid diluting ownership (unlike equity funding)
- Build business credit with responsible use
- Access funds quickly after initial approval
- Lower cost than credit cards or merchant cash advances for ongoing needs
- Many providers now offer fast digital applications and same-day or next-day funding
Main Types of Business Lines of Credit in the USA
- Unsecured Business Lines of Credit
No collateral required; based on personal/business credit, revenue, and cash flow. Faster approval, higher rates. - Secured Business Lines of Credit
Backed by assets (equipment, inventory, real estate, or CD). Lower rates, higher limits. - SBA CAPLines
Government-backed revolving lines (up to $5 million) for specific purposes (contract, seasonal, builders, working capital). Lowest rates but more paperwork. - Short-Term / Online Lines
Quick funding from fintech lenders; higher rates but lenient requirements.
Current Interest Rates & Terms (February 2026)
Rates vary widely based on lender type, creditworthiness, and whether secured.
- Bank / traditional lenders — 6.3% to 11.5% APR (often Prime + 1.75% to Prime + 9.75%)
- SBA-backed lines — Around 9.75% to 13.25% (variable, tied to Prime)
- Online / alternative lenders — 7% to 30%+ APR (some start as low as 4.66%–6%, others reach 20%–99% effective)
- Average range across providers — 7%–28% APR
Typical terms:
- Credit limits — $1,000 to $3 million+ (most small business lines: $10,000–$500,000)
- Draw period — 6–24 months (some renewable annually)
- Repayment — Interest-only on drawn funds; flexible principal repayment
- Fees — Origination (0%–3%), draw fees, annual fees, inactivity fees (some lenders)
Lower rates go to established businesses with strong credit (700+ FICO) and high revenue.
Who Qualifies for a Business Line of Credit?
Requirements differ significantly between banks and online lenders:
Common criteria:
- Personal credit score — 600–700+ (banks often 680–700+; online 560–650)
- Time in business — 6 months to 2+ years (some accept 3–6 months)
- Annual revenue — $50,000–$250,000+ (higher for banks)
- Positive cash flow and profitable financials
- Business credit score (if established)
Bank lenders (e.g., Bank of America, Wells Fargo) — Stricter: 700+ credit, 2+ years, $100,000+ revenue
Online lenders (e.g., Bluevine, Fundbox) — More flexible: 600+ credit, 6+ months, $40,000–$100,000 revenue
Step-by-Step: How to Get a Business Line of Credit in the USA
- Determine your needs — How much limit? Secured vs. unsecured? Speed vs. low rate?
- Check credit & finances — Review personal/business credit; gather statements, tax returns.
- Compare lenders — Use marketplaces (Lendio, Fundera) or review sites (Forbes, NerdWallet, Bankrate).
- Prequalify — Many offer soft-pull prequalification (no credit hit).
- Apply — Submit online or through a banker; provide docs (tax returns, bank statements 3–12 months, financials, business plan if needed).
- Review offers — Compare APR, fees, draw/repayment terms, funding speed.
- Finalize — Sign agreement; funds available immediately or within days.
Top Business Line of Credit Providers in the USA (February 2026)
Here are leading options based on recent reviews for speed, rates, flexibility, and accessibility:
- Bluevine
- Best for low rates & fast funding
- Limits: Up to $250,000
- Rates: Starting ~6%–14%+
- Requirements: 625+ credit, 6+ months, $40,000+ revenue
- Funding: Same/next day (faster with Bluevine checking)
- Fundbox
- Best for startups & lenient requirements
- Limits: Up to $150,000
- Rates: Starting ~4.66%+ (weekly repayments)
- Requirements: 600+ credit, 3+ months, $100,000+ revenue
- Funding: Next business day
- American Express Business Line of Credit
- Best for existing AmEx users & competitive terms
- Limits: Up to $250,000
- Rates: Variable (often competitive)
- Requirements: 660+ credit, established business
- Funding: Fast for qualified applicants
- OnDeck
- Best for repeat borrowing & established businesses
- Limits: Up to $250,000+
- Rates: 7%–30%+
- Requirements: 600+ credit, 1+ year, $100,000+ revenue
- Funding: Same/next day
- Bank of America / Wells Fargo (traditional banks)
- Best for lowest rates (secured/unsecured)
- Limits: $10,000–$3 million+
- Rates: Prime-based (~8%–12%)
- Requirements: 680–700+ credit, 2+ years, high revenue
- Funding: Slower (weeks)
Other strong options: Kapitus, PNC, National Funding, Lendio (marketplace).
Pros & Cons of Business Lines of Credit
Pros
- Flexible access to capital
- Pay interest only on what you use
- Reusable credit line
- Builds business credit
- Often faster than term loans after approval
Cons
- Variable rates can increase costs
- Minimum payments required even if unused (some)
- Higher rates from online lenders
- Strict requirements at banks
- Fees can add up (origination, draw, annual)
Tips to Get Approved & Secure Better Terms
- Improve personal/business credit before applying
- Maintain strong cash flow and clean financials
- Start with prequalification to compare offers
- Consider a marketplace like Lendio or Fundera to shop multiple lenders
- Open a business checking account with the lender (speeds funding, may lower rates)
- Use for short-term needs rather than long-term financing
- For startups: prioritize online providers like Fundbox or Bluevine
Final Thoughts
In February 2026, a business line of credit remains one of the most versatile financing options for U.S. companies, especially for managing cash flow without fixed repayment pressure. If you have solid credit and revenue, start with traditional banks or SBA CAPLines for the lowest rates. For faster access or more flexible requirements, online lenders like Bluevine, Fundbox, and OnDeck lead the way.
Always compare total costs (APR + fees), read terms carefully, and ensure your business can handle minimum payments. With the right line of credit, you can keep operations smooth, seize opportunities, and grow confidently throughout 2026.
