Few online business lenders are as highly regarded as BlueVine. If you were to research BlueVine’s products, you’d quickly be greeted by a plethora of glowing reviews, and for good reason. For starters, BlueVine offers virtually all of the advantages you’d expect from a reputable online lender. Their products are easily accessible for younger, smaller businesses as well as applicants with subpar personal credit. The longest you’ll have to wait to receive funding is seven business days. Even BlueVine’s fee policies are considered optimal in comparison to the rest of the industry.
Still, no business lender holds the perfect solution for every type of business. Certain cash flow situations call for different products, and these businesses may not be able to meet BlueVine’s general requirements. Thankfully, there are plenty of other options for businesses that need a slightly different solution for their cash flow issues.
Before we discuss those options, let’s explain what separates BlueVine from other online lenders.
1. BlueVine Specializes In Short-Term Financing
BlueVine offers three products: invoice factoring, business lines of credit, and business term loans. Invoice factoring is commonly used to fill minor gaps in cash flow, while the latter two products can be used for a multitude of scenarios. With BlueVine, however, the maximum term length for business lines of credit and business term loans is twelve months. Both products also have fairly modest borrowing limits of up to $250,000.
This brings us to the most distinguishing quality of BlueVine: they specialize in short-term financing.
If you’re looking for a larger borrowing amount to cover a long-term investment, it might make more sense to seek other options. BlueVine’s ideal customer has short-term needs, like purchasing inventory or making payroll. All three of their products are essentially geared towards the same purposes, as opposed to more expensive, long-term needs like purchasing additional property or major renovations.
2. Higher Payment Frequencies and Larger Payments
From a business lender’s perspective, short-term financing is considered to be riskier. Borrowers tend to have lower credit scores, less time in business, and lower annual revenue. This is why short-term financing products often feature more stringent repayment structures and larger payments. Both features offset the heightened risk of working with less established businesses. For example, BlueVine’s six-month business line of credit requires weekly payments. This same repayment structure applies to all BlueVine term loans.
The frequency and size of your weekly payments could be an issue for certain cash flow situations. Many businesses are prone to unforeseen dips in revenue, which can result from a host of circumstances: inclement weather, changes in demand, broken equipment, etc. It could be difficult to continue paying the same amount at the same frequency during these misfortunes.
Other online business lenders may have more room for flexibility with business lines of credit and term loans. Some even allow borrowers to choose between weekly, monthly, or daily payments, depending on what works best for their cash flow. Flexible repayment structures are particularly advantageous for highly seasonal businesses or businesses that do not regularly maintain high bank balances. Such borrowers might be more suited for entirely different products altogether. When you’re dealing with tumultuous cash flow, you’ll probably have better luck with a business lender that offers a wider variety of products.
3. Certain BlueVine Products Are Harder To Qualify For
The risk associated with short-term financing can also make certain products less accessible. BlueVine can approve invoice factoring for credit scores as low as 530. Their business lines of credit, on the other hand, require a credit score of at least 600. Compared to other online business lenders, BlueVine’s minimum annual revenues are on the higher side as well. Borrowers must earn at least $100,000 per year in order to access invoice factoring, term loans, and six-month business lines of credit. For twelve-month business lines of credit, borrowers must be in business for at least two years and bring in at least $450,000 per year.
If your business cannot meet either requirement, don’t worry. Twelve-month business lines of credit are available through numerous online lenders with looser requirements. Lastly, it’s worth noting that all BlueVine products are not available for businesses located in North Dakota, South Dakota, or Vermont. BlueVine also does not work with auto dealerships, despite their considerable need for short-term financing.
Minor Details Set Online Lenders Apart
Potential borrowers tend to lump online business lenders together when shopping for financing. At first, it seems like they all offer the same products for the same borrowers. But as you can see, companies like BlueVine have very unique requirements, borrowing limits, terms, and repayment structures. These are the kind of details potential borrowers must keep in mind when examining their options. Different online lenders suit different types of cash flow. The more details you know about your individual goals and challenges, the easier it will be to find the right product for your business.