What Are The Best Banks For Small Business Loans?
By Anna Serio
Updated Oct 16, 2020
We chose these banks based on the amount businesses can borrow, minimum requirements and types of loans available. To present the widest scope to our readers, we categorized each lender based on its strength — but most banks offer similar loan options so you can choose the best loan with other factors, like business credit card and bank account options, in mind.
What's changed in 2020
7 best banks for small business loans
Best for comparing bank loans: SmartBiz
Best for smaller loans: American Express
Best for business with limited revenue: Regions
Best for SBA loans: Wells Fargo
Best for large loan amounts: SunTrust
Best overall: PNC Bank
Best for business lines of credit: BBVA Compass
★★★★★
on SmartBiz business loans’s secure site
Best for comparing bank loans: SmartBiz business loans
650
Min. Credit Score
6.25%
Starting APR
$5,000,000
Loan Amount
SmartBiz is a connection service that works exclusively with banks. While previously an SBA loan broker that offered packaging services, SmartBiz has branched out to help small business owners find traditional bank loans as well. But if you do want an SBA loan, this might also be a great place to start. It only partners with preferred lenders and packaging services can cut the turnaround time from months to weeks.
★★★★★
Best for smaller loans: American Express business loans
Not stated
Min. Credit Score
6.98%
Starting APR
$75,000
Loan Amount
American Express is ideal if you already have a business card and are looking for a small loan amount. While most banks require you to borrow at least $10,000, Amex has a low minimum of just $3,500. And American Express is the only bank on our list that offers loans specifically for working capital and credit card debt consolidation, as well as merchant cash advances.
★★★★★
Best for smaller loans: Regions Bank business loans
600
Min. Credit Score
7%
Starting APR
$1,000,000
Loan Amount
Regions has low annual revenue and time-in-business requirements that make it easy for small businesses just getting started to find funding with a bank. And because you may be able to lower your APR after six months of on-time payments, your starting rate doesn’t have to be your final rate. Just be sure your business doesn’t need too much or too little: Regions only offers loans between $15,000 to $1 million.
★★★★★
Best for SBA loans: Wells Fargo business loans
670
Min. Credit Score
5.26%
Starting APR
$100,000
Loan Amount
Wells Fargo offers a wide variety of loan options for small businesses, including the SBA 7(a), 504 and Express loan programs. And because it’s an SBA Preferred Lender, the approval process won’t take months. However, only current customers with a year of banking history are eligible to apply using its online application. Everyone else will need to make an appointment and visit a branch to get started.
★★★★★
Best for large loan amounts: SunTrust business loans
Not stated
Min. Credit Score
4.54%
Starting APR
$10,000,000
Loan Amount
SunTrust — now operating under Truist — offers some of the largest business loans out there, with its maximum amount topping out at $10 million. Its rates are competitive, and terms span up to 20 years. It also offers four types of SBA loans on top of traditional bank loans and lines of credit to suit your business’s needs.
★★★★★
Best overall: PNC Bank business loans
Not stated
Min. Credit Score
8.18%
Starting APR
$100,000
Loan Amount
This regional bank’s loan officers offer the quality service you might find with a local bank — but you can manage your account and even apply online if you’re already a customer. It doesn’t require collateral on loans under $100,000 — rare for a bank. And it’s an SBA-preferred lender, meaning that it has the authority to process applications for you. The main drawback is that its customer service team gets poor customer reviews.
★★★★★
Best for business lines of credit: BBVA Compass business loans
Not stated
Min. Credit Score
N/A
Starting APR
$100,000
Loan Amount
Most banks have unsecured and secured lines of credit, but BBVA Compass has three options with different credit limits and collateral requirements for each. And if you already bank with BBVA, you may qualify for an autopay discount of 0.25% to 1% off your APR. However, BBVA Compass only operates in a handful of states, and it has quite a few negative reviews — with multiple complaints about its customer service and high fees.
5 most active SBA lenders in 2020
These lenders offered more financing through the SBA 7(a) program than any other provider out there.
LenderTotal funded in 2020Best for …
Live Oak Bank
$850,070,700
Working with an industry specialist to a fund large project or refinance debt
Byline Bank
$463,603,700
Lower-than-average collateral requirements, especially on large SBA loans
Wells Fargo
$382,005,600
SBA funding from a national bank
Huntington National Bank
$366,870,100
SBA loans on the smaller end — these start at $5,000
Celtic Bank
$322,246,300
Online and offline expert assistance with the application
Source: 100 most active SBA 7(a) lenders, SBA.gov
The most active lenders aren’t necessarily the best. Visit our guide to the best SBA lenders to find a government-backed loan that’s right for your business.
How do I find the best bank loan for my business?
Borrowing from a bank is different from going to an online lender. It’s usually about more than just getting one loan, but developing a relationship. Instead of looking at rates and terms — which can be difficult to find — consider these factors:
Your business’s banking history. Banks prefer to work with current customers, and the longer you’re with the bank the better deal you’ll get on financing. If you already have a business checking account start your search with that bank.
Other available products. look at all of the other services that the bank offers and try to go for one that you — and other business owners would be comfortable with as a go-to for financial products.
Industry specialists. Often banks have loan officers that are experts in a specific industry. They can provide valuable insights into your business’s operations and anticipate your financing needs.
Types of loans. If you’re looking for a specific type of financing — like an SBA Export Express loan — make sure a bank offers it before reaching out.
Customer reviews. Look to sites like Trustpilot and the Better Business Bureau see what customers have to say about loan officers and customer service. But take it with a grain of salt – customers generally write reviews in extreme situations.
Employee reviews. A bank with low employee ratings could be a warning sign, especially with local banks. Low morale can be a sign that you might not get top-notch service and have to switch loan officers frequently.
Types of banks that offer business loans
The type of bank you go with makes a difference in the experience you have with a lender. These are the main types of banks you’ll find in your search.
Large national and international banks
Big names like Wells Fargo and Chase fall under the category of large national banks. The benefit of working with these banks is that they’re available in most states and have the budget to invest in new technology that smaller banks might not access. These might benefit businesses that operate in multiple states.
Regional banks
Regional banks typically offer services that are a little more tailored to the industries in the states that they serve. They also typically have multiple branches and offer a wide range of online services and tools. These are generally a good option for businesses owners that want a personal touch but also would like to manage their accounts virtually.
Community banks
Community banks specialize in financing the local businesses in their areas. Loan officers are often experts in the local market as well as popular industries in their area. They may even be a customer if you run a local small business. These are your best bet when you want to develop a close, mutually beneficial relationship with a financial institution in your area.
But they often only have a handful of branches. They were also traditionally slow adapt to new technology — though have started partnering with tech companies to bring applications online.