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You’re starting a business, or running an already operating business, and you don’t have enough working capital to pay for things like office supplies or advertising, or even hiring employees. On top of that, let’s say you have a high utilization percentage on your credit card usage, or maybe you went delinquent at some point, and as a result you have bad credit.

This doesn’t mean you won’t be able to get the funds you need.

According to the Security Standards Council, a bad credit score is anywhere from 300 to 499. When starting or running a business with bad credit, it’s important to know your options. Ultimately, the business financing you are looking for may be more accessible than you think.

The methods listed below are ordered from company life span (recommended from younger to older), as well as taking the risk level into account (from lower risk methods to higher risk methods such as small business loans).


Crowdfunding has helped thousands of ideas get off the ground, giving new companies access to the funds they need. For those unfamiliar, sites like and allow people to make a page for their ideas, and for people to donate to fund those ideas. They range from website and app ideas, to video games, to nonprofit and relief funds, to film and theater productions. For example, Bluebox Theatre Company, a production company in New York, uses crowdfunding (in combination with ticket sales) to help pay for their costumes, performers, set pieces, and transportation. Here are a couple things that helped their campaigns in the past.

    • Video: Every successful crowdfunding campaign has a customized video that showcases what your money is going to be used for. People get creative, so be sure to check out a few more successful campaign videos before making your own.
    • Perks: Crowdfunding sites allow entrepreneurs to give out incentives for people to donate. In Bluebox’s production of “Night of the Living Dead Live”, they offered small perks for small donors like a signed playbill, to large perks including a producer credit for the production. Perks are important because they are one of the biggest ways to differentiate your campaign from the next. Be sure to check out similar projects’ perks before creating your own.
    • Filler Money: People are more likely to donate to projects that are closer to completion. Therefore, even though sometimes up to 10% of your donations are taken out and given to the site itself, sometimes it can make more sense to fill up your page’s donated funds with some of your own money to give the appearance that it is doing better than perhaps it actually is. There are companies out there that specialize in exclusively helping campaigns that are 75% or closer to reaching their goals.
    • Spreading the Word: The use of Social Media is arguably the most important aspect of crowdfunding campaigns. Sharing the link on Facebook pages, messaging family and friends, and, if you have the funds, hiring a third party crowdfunding boosting company are all ways you can spread the word. Reaching out to people is a numbers game, so the more you do it the more you will benefit. And if your perks are on point, people will be more likely to come back and donate to future projects if you choose to do this again.

Crowdfunding is an immensely popular way to raise money nowadays, and if your project is popular, the possibilities are endless. The influential Oculus Rift was started through, and raised $2,437,429 in 30 days. The open-source Android video game console, Ouya, raised $8,596,474. The industry of crowdfunding itself has grown tremendously too. In 2015, the total funding volume was at $34.4 billion. According to a recent report by Massolution, crowdfunding is set to account for more funding than venture capital. The average successful crowd funding campaign is around $7,000. With the right kind of team, strategy, visuals, and copy, you can create a campaign that can give your company the financial boost it needs, while building zero debt.


The next step up from crowdfunding is microloans. With banks offering less loans and more people starting companies, microloans are becoming a more and more popular way to fund smaller campaigns. These are small loans that are given to companies that are denied normal business loans from financial institutions. They are similar to crowdfunding because they can be made up of multiple people giving money, but the core difference is that microloans need to be paid back, and with interest.

Microloans are typically used for working capital, inventory or supplies, furniture or fixtures, and machinery or equipment. Typically, lenders say that microloans cannot be used to pay existing debts or purchasing real estate. The repayment terms depend on a few things, such as the loan amount, how the loans are going to be used, the requirements set forth by the lender, and the actual needs of the small business owner.

They were made popular by 2006 Nobel Peace prize winner Muhammad Yunus, a Bangladeshi economist. Yunus started Grameen Bank and it specialized in giving money to women to buy cows, seeds, and other things people would use to do business. Grameen America has distributed over $270 million, and is responsible for the creation and sustaining of 57,000 jobs. Grameen also has their borrowers work in teams and attend training programs together, as a way to push people to pay back their loans quicker.

Kiva is the first online person-to-person micro-financing firm. People can help fund a loan with as little as $25. It works with other local micro-finance firms. So far, Kiva has distributed over $700 million in almost a million loans. Oprah Winfrey has said, “Kiva is a simple concept that can change a person’s life.”

You may have heard of the Small Business Administration, SBA for short. The SBA has a microloan typically offers around $13,000 in loans, but they have an upwards limit of $50,000. The money itself is distributed through local intermediary office, so in order to apply you would need to find your local office through the SBA District office. The intermediary typically requires something as a form of collateral, as well as the personal guarantee of the business owner. The maximum amount of time allowed before repaying these loans is six years. Their average loan amount is around $13,000. Generally, interest rates range from 8% to 13%. The SBA, like Grameen, also has training programs and repayment plan requirements to help the borrowers improve and expand their business, as well as to help everyone get their money back.


With the recent recession, there are still tons of people with less-than-perfect credit who need larger business loans, and there are still places who are ready to give them out. Typically, bad credit business loans are convenient, and you can usually find yourself approved within a few hours. You may even get the funds that same day, if not within a few days. Also, these types of business loans may be a good way for you to start rebuilding your credit. Given, the lower your credit score, the higher your interest rates on loans. That is something you will have to be prepared for either way. If your company is in the position where you are making monthly profits, but for whatever reason you have bad credit, you can go to United Capital Source, and apply for a bad credit business loan. As opposed to looking at your whole credit history, UCS will only look at your past three months’ bank statements.

If your company is growing, but running out of resources, these three steps could considerably help.

      1. Call 855.933.8638 or email [email protected] and ask for someone to help you apply for a bad credit business loan.
      2. Fill out a 1-page merchant loan application form with business loan amount, average credit card volume and gross sales per month, type of business, Fico score and business references. It only takes a few minutes.
      3. Get funded within a few business days of application submission. UCS will work closely with you so you can receive funds in a few business days after completing your application.

People who have no luck with dozens of vendors typically find what they need with this type of loan. The one thing to remember about this type of loan, however, is that it is more expensive. It is up to you to decide if the extra cost is worth it or not. A lot of times it is, because it may be the only option around for you.

Something to keep in mind is that most economists say you shouldn’t start a new business entirely on a small business loan, but rather save that kind of loan to a point where you have months of consistent cash flow. If you have bad credit, these methods will help you get the funds you need to continue development (and hopefully turn that credit score around).  United Capital Source offers small business loans, even with bad credit, and we work hard at putting the borrower’s business at the top of our priorities.  You can learn more about our bad credit small business loan program here.

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