Many business owners need access to cash quickly to cover payroll or other operating expenses. When you need to borrow money fast, Fundbox could be an ideal choice. You’ll have the option of a line of credit or invoice factoring, and Fundbox makes it easy to get approved compared to some other business lenders.
It’s important to understand the different financing options Fundbox offers as well as the terms and conditions of the loan you’re considering so you can decide if Fundbox is the right online lender for you. This Fundbox review will cover everything you need to know to make an informed choice.
In this review:
- How to Get a Fundbox Line of Credit
- Basic Information: Rates, Terms, Fees, & Limits
- The Benefits of a Fundbox Line of Credit
- The Downsides of a Fundbox Line of Credit
How to Get a Fundbox Line of Credit
Fundbox offers several different solutions for companies, but a line of credit is the most flexible. With a Fundbox line of credit, you can borrow as much as you need for approved business purposes when you need it, up to your total credit line. Loan amounts up to $100,000.
Small business owners can apply for a Fundbox line of credit online by visiting the website and clicking “Apply Now.” You can obtain an initial credit decision without a hard credit inquiry, so your credit score won’t be affected unless you’re approved and decide to draw funds (at which point Fundbox will conduct a hard credit check). You’ll need to provide some basic information to create a Fundbox account and apply for funds, including:
- Your name
- Your contact details
- Annual business revenue
Fundbox will also ask for the login to your accounting software or business bank account so it can verify the financial details you provided. Typically, you will have an answer within three minutes or less of submitting your application. If you’re approved, you can simply request to draw funds from your line of credit and can have the money as soon as the next business day.
Fundbox has a few simple requirements you have to fulfill in order to get approved for a business line of credit.
- You must have a business checking account.
- You need at least two months of activity in accounting software that Fundbox supports or three months of transactions in a business checking account.
- You will need to give Fundbox access to your accounting software and/or your business checking account.
- Your company needs to have a minimum annual revenue of $50,000. The average business borrower that receives a Fundbox line of credit, however, has annual revenue exceeding $250,000.
- Your business must be based in the United States or within select U.S. territories.
If you are not able to qualify for a business line of credit, you could also consider invoice factoring if you are a B2B business (which means you primarily sell products or services to other companies). Invoice factoring, which involves essentially selling your outstanding invoices to Fundbox for a portion of their current value, can be an alternative to a traditional small business loan.
With Fundbox invoice financing, you’ll need at two months of invoicing activity in accounting software that Fundbox can access, such as QuickBooks, Sage One, Xero, or FreshBooks. A complete list of compatible software is available on the Fundbox website.
Basic Information: Rates, Terms, Fees, & Limits
Fundbox offers loans with flexible repayment terms. Here are some of the factors you should consider:
- There’s no application fee charged on Fundbox loans.
- In lieu of a traditional APR, you’ll pay a fee of 4.66% or 8.99% depending on your repayment term. The fee is lower on a 12-week repayment plan, but the weekly payment amount is higher because you’re paying off what you borrowed over a shorter period of time. This allows you to customize your payments to better meet your business needs.
- You can become eligible for a line of credit up to $100,000.
- No personal guarantee or collateral required.
- Fundbox will waive any remaining fees when you repay your line of credit early.
The Benefits of a Fundbox Line of Credit
There are many advantages to taking out a Fundbox line of credit when your business needs to borrow. Here are some of the major benefits:
- Fast access to cash: You can apply online and get a credit decision within just three minutes. Once you have been approved, you can choose to receive your funds by the next business day. This provides very timely access to the credit limit you need to continue operations if your company runs into a cash flow crunch.
- Loans are unsecured: You do not have to put down collateral for the loan.
- Smaller and newer businesses can qualify more easily: Many financial institutions that offer business lines of credit require your company to have been open longer or have higher annual revenues to be approved. In addition, there are no minimum credit score requirements to apply.
- Transparent pricing: Borrowers will always know the fees they’ll pay before drawing from their line of credit.
The Downsides of a Fundbox Line of Credit
There are also some downsides to borrowing with Fundbox, including:
- Very new businesses need not apply: If you don’t have three months of transactions in your bank account or accounting software to show Fundbox, you won’t be able to access cash through a Fundbox business line of credit.
- You have to provide Fundbox with account access: The application process involves giving Fundbox access to your bank account or your invoicing software. Although this streamlines the application process, some companies may not feel secure handing over these details.
- You must meet minimum revenue requirements: Not all businesses have the minimum annual revenue Fundbox requires to get approved for a line of credit. If yours doesn’t, you won’t be able to get this type of financing through Fundbox.
Getting approved for financing is often one of the biggest challenges new businesses and entrepreneurs can face. Fundbox aims to solve these problems by providing short-term lines of credit to companies with a minimum annual revenue of just $50,000.
Although this is still a high revenue target, it’s far below what many competitors require so it’s much easier to get approved. This easy approval, combined with very fast access to cash, make Fundbox a lender worth considering, especially for smaller businesses that need cash quickly for a pressing expense. However, potentially high interest rates mean more established businesses with good credit histories should look elsewhere to save on fees.