Your Guide to Securing a Business Loan online

Your Guide to Securing a Business Loan online

Do you need funding for your business? All over the world, business owners have come to terms with the fact that they need to pump funds into their enterprise at one time or the other for growth and survival reasons. If you find yourself in need of funds for your business, there are several online channels to help you with the funding you need for your business. However, it would be best if you were guided effectively to do it rightly.

How to apply for a Business Loan online

First of all, it is important to note that business loans secured online are usually for small businesses. The paperwork is necessary for your application. How to file your application is usually formatted on the app or the website from which you are sourcing for a loan. That being said, the first thing to do is to identify the specific type of online business loan suitable for your business.

Choosing an Online Business Loan type

When trying to obtain an online business loan type, there are several options available to you if you’re interested in applying for a business loan online. The major ones are:

  • Business lines of credit
  • Short-Term Loans
  • Equipment financing
  • SBA loans
  • Invoice financing
  • Merchant Cash Advances

Online loan platforms usually fall in one of the categories mentioned above. Each category has advantages and shortfalls associated with them. For example, Short-term loans are a great choice if you need quick funding for your business but don’t want to tie up your future expenses.

Although they have a similar structure compared to long term loans, they are usually repaid over 3-18 months. Also, some online sources of short-term loans offer a huge amount to businesses. You can borrow medium-to-large amounts up to ₦20,000,000 from some online sources. However, the downside of lenders making such offers is that shorter repayment terms can often mean higher monthly payments, which you might find difficult to keep up with.

Another online loan channel worthy of the spotlight is the SBA. This is the acronym for Small Business Administration loans. It is a widely embraced mode of funding small businesses because the structure helps to minimize the risks so that loan takers will not run into debt after taking the loan. One high point of obtaining an SBA loan is the amount of time you have to pay it back with little or no penalty. For SBA loans, the term of your loan will depend on the specifics of how you are going to use the money.

In any case, the general rule applies that the longer your term, the lower your interest rate, and the lower your monthly payments. The advantage of this arrangement is that you can invest in your business even while repaying your loan. Whatever type of loan you want to opt for, you must examine your qualification status.

Another option when it comes to online borrowing is taking out a merchant cash advance. This type of financing involves a lump sum cash injection issued in return for a portion of your company’s sales. For many online merchant cash advances, a minimum credit score of 500 or higher is required. Therefore, if you are thinking of getting online loans through this channel, you already have an idea of what awaits you.

Are you qualified for an Online Business Loan?

You do well to go online (after identifying a loan that fits your business needs) to see if you qualify. Online loaning sources do look at the number of years you are likely to stay in operation, your annual revenue, your credit score, and a host of other factors to determine your qualification status. You can check if you qualify for a loan with lendigo here

The pros and cons of Online Business Loans

While a few advantages of taking online business loans have been mentioned, there is more to that. At the same time, it also comes with a few lows.


  • For businesses going through a tough time financially, online financing provides quick access to cash. Some lenders can grant you the needed funding in a matter of minutes, provided you are qualified.
  • It offers business owners a much more convenient and pragmatic loan application process than the conventional application process.
  • Business owners will not have to contend with emotional issues such as racial, political, or religious affiliation of officers IN charge of the loans. The set mechanism will only check for the qualification criteria and take a yes/no decision.


  • You may have to deal with shorter repayment terms.
  • Most of the time, rushed funding comes with a price. If you need cash as soon as possible, financing from an online lender may result in higher interests.

What does the Online Application Process involve?

On a good day, online lenders require applicants to submit some information for the application. The type of information required is dependent on the criteria they use in granting loans. In any case, it could include the following:

  • Business name and legal name
  • Contact information
  • Income and annual revenue information as found on a bank statement
  • Valid means of identification.

Depending on the online lender, your qualifications, and the type of loan you’ve applied for, financing can be approved within hours, and funding could be transferred to your business bank account in as little as 24 hours.

Are Online Business Loans Safe?

To start with, what makes a loan safe? A safe loaning medium must keep sensitive information that is revealed to them during the application process confidential. Also, it should ensure that there are no hidden terms and conditions.

Given these two major characteristics of a safe loaning medium, make sure you go for online business loan applications that are managed and reviewed electronically using secure web portals. This will guarantee the protection of your data via encryption and keep them safe from hackers.

A popular example is the Secure Sockets Layer (SSL) encryption. This is a standard technology that links the web server and your browser highly secured from security threats. It provides an end-to-end encryption system that ensures that all data and messages between you and the lender are kept private.


You can successfully secure a small business loan from the comfort of your home. Online lenders make the loan application process quick and easy. However, securing a business loan online requires that you are equipped with relevant information to do it rightly. Therefore, you need to note everything mentioned and exercise due diligence and thoroughly research any lender or platform you use to apply for an online business loan. You can also reach out to associates who have towed this path sometimes in the past. They are in a good position to give you additional relevant tips.

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