Today's Small Business Loan Rates: What They Really Cost by Product

As of 2026, small business loan rates generally run from roughly 10.5%–16.5% APR for SBA 7(a) loans, 8%–13% for conventional bank term loans to well-qualified borrowers, 25%–65%+ APR for online/short-term term loans, 12%–60%+ APR for business lines of credit, and — for revenue-based financing and merchant cash advances — a factor rate of about 1.15 to 1.49 rather than a stated APR. The single biggest driver of your rate is not the headline number a lender advertises; it's your profile: time in business, monthly revenue, bank-deposit consistency, personal credit, and how fast you need the money. The faster and easier the approval, the more you pay. This page walks through what each product actually costs today, how to decode a quote, and which structure fits a given cash-flow situation.

Current rate ranges by product (2026 snapshot)

There is no single "small business loan rate." Pricing is a spread that depends entirely on which product you're using and how strong your file is. Here are the ranges lenders are quoting in 2026, from cheapest to most expensive:

• SBA 7(a) loans — roughly 10.5%–16.5% APR, tied to the Prime Rate plus a lender spread. Longest terms (up to 10 years working capital, 25 years real estate), lowest cost, slowest to fund.
• Conventional bank term loans — roughly 8%–13% for strong, established borrowers with collateral and two-plus years of clean financials.
• Online / fintech term loans — roughly 25%–65%+ APR. Faster and more forgiving on credit, priced accordingly. Terms usually 6–24 months.
• Business lines of credit — roughly 12%–60%+ APR depending on whether it's bank-issued or fintech-issued. You pay only on what you draw.
• Equipment financing — roughly 8%–30% APR, secured by the equipment itself.
• Revenue-based financing / merchant cash advance — quoted as a factor rate, typically 1.15–1.49, not an APR. Repaid as a fixed daily or weekly percentage of deposits. Fastest funding, most forgiving on credit.

Notice the pattern: cost rises as speed and approval ease rise. That trade-off is the whole game.

Why your rate is different from the advertised rate

Advertised rates are the price a lender's best applicant gets. Most businesses don't land there. Underwriters price your file on a handful of factors, roughly in order of weight for each product:

• Time in business — under 2 years pushes you out of bank/SBA pricing and toward online and revenue-based products.
• Revenue and deposit consistency — steady monthly deposits matter more than a single big month. Lumpy or declining deposits raise your cost everywhere.
• Personal FICO — banks want 680+; online lenders work down to the 600s; revenue-based funders can approve at 500+.
• Existing debt / position — stacked advances or high existing obligations tighten what you'll be offered.
• Industry — some sectors (restaurants, trucking, construction) get repriced for volatility regardless of individual strength.

Two businesses with identical revenue can get quotes 20 points apart based on these factors. That's why comparing your quote to an advertised rate tells you almost nothing — compare it to what your profile should command.

How to read a quote: APR vs. factor rate

The most expensive mistakes come from comparing two prices that aren't the same unit. An APR annualizes cost and accounts for fees and repayment timing — it's the honest apples-to-apples number for any term loan or line of credit. Always ask for it in writing.

A factor rate (used for revenue-based financing and merchant cash advances) is a flat multiplier on the amount advanced. A 1.30 factor means you repay 1.3 times what you took. Critically, a factor rate is not an APR and does not shrink if you repay faster in most structures — the cost is fixed at funding. Factor-rate products are priced for speed and access, not for being the cheapest capital.

Three questions cut through any quote:

1. What's the total cost of capital expressed as a factor or an APR?
2. What's the payment, and how often — daily, weekly, or monthly?
3. Are there origination, underwriting, or prepayment fees stacked on top?

If a rep can't or won't answer all three plainly, that itself is pricing information. For a deeper walkthrough, see our pillar guide on how business loan costs really work.

Realistic example quotes across products

The table below shows illustrative offers a healthy business — say, 3 years in operation, roughly $60,000/month in deposits, mid-600s FICO — might see today. These are examples for comparison only, not offers, and your actual terms will differ.

Read the table as a menu of trade-offs, not a ranking. The SBA loan is the cheapest capital and the slowest, most paperwork-heavy path. The revenue-based option is the most expensive per dollar but funds inside a day or two and flexes with your sales — payments ease when deposits slow and rise when they climb.

Decision framework: matching rate to the job

The right rate is the one attached to the right structure for what you're actually doing. Rate alone is the wrong thing to optimize.

Revenue-based / MCA marketplace funding works best when:

• You need capital in 24–48 hours and can't wait weeks for a bank decision.
• Your credit is thin or bruised (FICO 500+) but your bank deposits and revenue are steady — approval leans on cash flow, not your score.
• The use of funds pays for itself quickly: inventory ahead of a busy season, a bridge on a signed contract, filling a receivables gap, a same-day equipment repair that keeps you earning.
• You want payments that move with your sales rather than a fixed monthly bill regardless of how the month went.
• You need at least ~$10,000 and want a single application shopped across multiple funders.

Avoid it — reach for a bank, SBA, or line of credit instead — when:

• Your timeline is flexible and you qualify for bank pricing; the rate difference is real money.
• You need a long payoff runway (5–10 years) for a large, slow-return investment like real estate.
• Your margins are thin enough that a daily deduction would choke operations.
• You're already carrying advances and would be stacking — that's a warning sign, not a strategy.

A good marketplace or broker earns its place by matching your file to the lowest-cost product you actually qualify for and fund on time — not by pushing the fastest, priciest option by default.

How to lower the rate you're offered

You have more leverage than most owners use. Before you accept anything:

• Clean up your deposits first. Three to six months of consistent, healthy bank activity — few or no negative days, no overdrafts — measurably improves offers, especially for revenue-based funding where the statements are the underwriting.
• Ask for the APR in writing and get every fee itemized. Origination and prepayment terms can swing true cost more than the headline rate.
• Take the shortest term you can comfortably service. On amortizing loans, a shorter term usually means less total interest — just don't starve your working capital to do it.
• Shop more than one funder. A single application run across a marketplace surfaces competing offers without multiple hard credit pulls in some structures.
• Match the product to the need. A revolving line for recurring gaps and a term product for one-time investments almost always beats forcing one tool to do both.

See our pillar on choosing the right business funding option for how these levers interact.

What's moving rates in 2026

Small business pricing tracks the broader cost of money. Two forces set the backdrop this year: the Prime Rate (which directly indexes SBA and most bank/line pricing) and lender risk appetite (which sets the spread on top). When Prime holds steady, bank and SBA rates stay range-bound and the real movement happens in spreads — lenders widening or tightening based on default trends in your industry.

Fintech and revenue-based pricing moves on a different clock. Because those funders price primarily on cash-flow data rather than a benchmark index, their offers respond more to your deposit trends and to portfolio performance in your sector than to Fed moves. Practically: if bank rates are flat but you're still being quoted high, the issue is your file or your industry's risk read — not the macro environment. That's fixable, and it's where the checklist above pays off.