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Rapid Finance Review: Pros, Cons, & How To Apply

Rapid Finance offers a diverse line of small business loans. Few small business lenders can boast Rapid Finance’s quick funding time. As the name says, the company specializes in rapid financing programs.

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The company enjoys an excellent online reputation and is a leader in the business financing space. However, their product line, potentially high interest rates, and fees might not fit every small business.

If you want to know if Rapid Finance is right for your business, we can help with answers to these questions:

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    What is Rapid Finance?

    Rapid Finance is a small business loan provider specializing in lightning-fast financing on certain products. Formally Rapid Advance, the company offered Merchant Cash Advances. The company updated its name along with expanding its product offerings.

    Since the company’s launch in 2005, it’s grown to be one of the most recognized names in alternative business financing. During that time, businesses across a wide range of industry sectors received over $2 billion in funding from Rapid Finance.

    Rapid Finance offers direct lending on certain products and works with lending partners to fund other products. This combination of financing options enables the company to work with borrowers to find the best loan product to meet their needs.

    What Loan Products Does Rapid Finance Offer?

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    Rapid Finance offers a diverse range of small business financing.

    Small Business Loans

    Rapid Finance business loans are traditional term loans. Borrowers receive a large sum upfront and then repay it plus interest and fees in fixed monthly payments. The repayment schedule is either daily, weekly, or monthly.

    Small business term loans start at $5000 and go as high as $1 million. The term length is generally between 3 and 60 months.

    Rapid Finance’s website doesn’t publish a range of interest rates or other fees for business term loans. However, with faster financing, interest rates are higher than most traditional lenders. Borrowers might get charged an origination or fixed fee, but it depends on the loan and your financial overview.

    Merchant Cash Advance

    A merchant cash advance is when you receive a large sum upfront for a percentage of future credit card sales or other revenue. Rapid Finance provides merchant cash advances ranging from $5,00 to $500,000. The amount you qualify for depends on your credit card processing statements.

    MCAs are usually repaid from a fixed percentage of daily credit card sales. Since your credit card sales might fluctuate, the payment amount fluctuates with it, resulting in undefined repayment terms. The flexibility is nice because you only pay what your incoming revenue can afford.

    Line of Credit

    A business line of credit operates like a credit card. You get a set credit limit and draw funds as needed. When you repay the amount you used, the credit limit replenishes. Lines of credit are good for short-term working capital and give you an option in case of emergencies.

    Rapid Finance’s lines of credit range from $5,001 to $250,000. Amortization terms run between 3-18 months. You’re only responsible for paying back the amount you draw plus any fees and interest. Automatic payments for lines of credit deduct from your business bank account in daily, weekly, or monthly payments depending on your financing agreement.

    Bridge Loans

    A bridge loan is a type of short-term financing to cover urgent expenses while you wait for larger-scale funding. The loan “bridges the gap”, so your business is covered in the short and long term.

    Rapid Finance’s bridge loans start at $5,001 and go up to $1 million. Terms are between 3 months and 5 years. Bride loans carry an interest rate or fixed fee, and other charges may apply. Your exact rate and fees depend on the loan amount and your company’s financials. Rapid Finance does not publish an interest rate range for this product.

    SBA Loan

    The Small Business Administration (SBA) is a government agency supporting small businesses. The agency partially backs the SBA loan program, allowing lenders to offer high borrowing amounts at lower interest rates and extended repayment terms. SBA loans are often considered the gold standard of small business loans.

    Rapid Finance SBA loan options range between $500 and $5.5 million with terms from 1 to 30 years. Regardless of the lender, the SBA loan program has some of the highest qualifications of any business loan product.

    It also takes a long time, at least several weeks, to complete the loan process and get funded. If you qualify and the funding time isn’t a problem, an SBA loan is an optimal small business financing option.

    Invoice Factoring

    If your business is waiting on customers to pay invoices but you need working capital now, invoice factoring can help. Invoice factoring is when you sell your outstanding invoices to a financing company at a discounted rate.

    You get a large sum upfront and either forward payments from customers to the factoring company or the factoring company collects the payment directly. Rapid Finance’s invoice factoring advance amounts start at $20,000 and go up to $10 million.

    Asset-Based Loans

    Rapid Finance’s asset-based loans use your existing assets as collateral to secure a loan. Loans with collateral are called secured loans because the collateral provides security to the lender, and loans without collateral are unsecured loans.

    With an asset-based loan from Rapid Finance, the amount you’re eligible to borrow is based on the value of the business assets you’re pledging as collateral. Since lenders have more security with asset-based loans, they can typically offer more money with better interest rates.

    Rapid Finance’s asset-based loans range from $50,000 to $10 million, which is the highest amount it offers. Repayment terms are between 6 and 36 months. The company doesn’t publish an interest rate range or other fees.

    Commercial Real Estate Loans

    A commercial real estate loan allows business owners to acquire a new property, renovate or upgrade an existing property, or, in some cases, even refinance debt on existing properties. While the loan shares some characteristics with a residential property mortgage, it differs in many ways.

    Commercial real estate loans are secured with the property acting as collateral. When the asset being financed is also the collateral, it’s called a self-collateralized loan. Rapid Finance’s commercial real estate loan amounts start at $75,000 and go up to $2 million. Repayment terms run from 5 to 20 years.

    What are Rapid Finance’s Qualifications?

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    Rapid Finance’s website doesn’t publish set qualifications for their loan products. Part of the reason why is that different loans have different requirements.

    For example, a business line of credit or merchant cash advance has a much lower threshold than an SBA loan. It also depends on the amount you’re requesting and the loan terms.

    Credit Score

    The company doesn’t list a minimum personal credit score or minimum business credit score. Some online reviews suggest the company accepts credit scores as low as 550, but that might be for specific products. SBA and larger small business loans likely require a credit score closer to the 650-670 range.

    Annual Revenue

    Again, the company does not list a minimum annual business revenue requirement, but we do know it depends on the loan type and amount you requested. Regardless of the loan, Rapid Finance will analyze your business to see what you can afford in terms of loan repayments.

    Years In Business

    Rapid Finance does not offer funding to startups or younger businesses. Most of their products require 2 years in business, but the only way to know for sure is to apply and get a quote.

    Required Documentation

    In all instances, you’ll need to provide legal identification and basic information about your business, such as bank statements. For invoice factoring, you might only need to provide proof of ID and the invoices from a credible invoicing agency.

    You’ll need in-depth documentation for SBA loans, including business tax returns, bank statements going back years, income statements, and more.

    For Rapid Finance, You Should Know That:

    Fast funding is their bread and butter and helps the company stand out in a crowded field. Rapid finance can sometimes provide same-day funding for certain products.

    The flip side of their lightning-fast funding process is that fast funding usually means higher interest rates and fees. It might not always be the case with Rapid Finance, but since they don’t publish interest rate ranges, the only way to find out is to apply. Also, many customers state their rates are competitive with similar short-term lenders.

    There are some state restrictions on certain products Rapid Finance offers. Make sure to check if your state is approved, or you can call Rapid Finance to ask.

    Rapid Finance’s customer service is generally very helpful, and you can usually get ahold of a live person when you call. Some customer complaints do say they had trouble getting through, though.

    Since they don’t publish specific qualifications or their rates and fees, it isn’t easy to do comparison shopping. The only way to get the relevant information is to start the application process and get a quote. Some customers stated the approval process took longer than expected and were denied despite indications they would qualify.

    Some Rapid Finance products will require a personal guarantee to secure the loan. Any business owner with a 20% stake or greater must sign a personal guarantee. If the borrower defaults, Rapid Finance may pursue a UCC blanket lien on business assets. However, most reviews indicate Rapid Finance is willing to work with borrowers to make arrangements and resolve outstanding balances before pursuing this course of action.

    You should also know that Rapid Finance restricts certain businesses. The company does not provide business funding for the following:

    • Marijuana businesses.
    • Casinos and gambling businesses.
    • All nonprofits, including churches.
    • Car dealerships.
    • Adult entertainment.
    • Travel agencies.
    • Payday loan companies.
    • Law firms.
    • Consumer debt counseling services.
    • Bail bonds.
    • Collection agencies.
    • Annual memberships.
    • Direct/multi-level marketing.
    • Firearm businesses.

    There may be others as well.

    How to Apply to Rapid Finance:

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    Like most online lenders, the process starts with completing a prequalification questionnaire. Rapid Finance’s goal is to expedite the process so they can approve and fund the loan as fast as possible.

    Step 1: Apply and Connect Your Business Bank Account

    You can apply for Rapid Finance through the United Capital Source online application. The one-page application requires basic information about your business.

    You’ll need to provide business bank statements from the previous three months. If approved, Rapid Finance distributes the funds to that business account.

    Step 2: Review

    Rapid finance’s team will review your application to determine approval. One of their advisors will reach out if they need additional information.

    Step 3: Get Funded

    Once approved, Rapid Finance sends the funds to your business bank account. Some loans are funded on the same day, but others take 1-3 business days.

    SBA loans might take several weeks to approve and fund.

    Rapid Finance, Post Funding:

    Payments for your loan product automatically deduct from the business bank where you received the funds. For merchant cash advances, the payments come from a percentage of your credit card sales. Rapid Finance is repaid for invoice factoring when customers pay their outstanding invoices.

    Unlike some short-term lenders, Rapid Finance does not offer a discount when you pay off the loan early. According to one online review, getting a 20% discount might be possible when you pay off the loan in 120 days.

    Online reviews also suggest Rapid Finance has good renewal and retention rates as many customers repeat business with them.

    What are the Advantages of Rapid Finance?

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    The most significant advantage of Rapid Finance is right in the name – providing funds quickly. The application process is fast and straightforward. Approval usually only takes a few hours to complete. If everything aligns, you can receive same-day funds, depending on the loan product.

    The various loan products also make finding the right financing program for your business easier. In some cases, you could get multiple loans. For example, you can get a bridge loan while waiting for more long-term financing approval.

    Most customers talk about how excellent the customer service is and express that their rates are competitive with other alternative short-term lenders. Rapid finance also offers flexible payments with daily, weekly, or monthly schedules.

    What are the Disadvantages of Rapid Finance?

    Short-term lenders tend to have higher rates and fees than traditional long-term financing agreements. While Rapid Finance’s rates are competitive with similar lenders, you can still expect to pay a high price for financing. Of course, if you need the money urgently, that price is sometimes worth it.

    Rapid Finance doesn’t publish set qualifications or interest rates and fees, making it difficult to do comparison shopping. Since the company offers many lending products and works with approximately 60-70 lending institutions, rates and fees change rapidly. The only way to find out how much you’ll pay is to apply and get a quote.

    Another disadvantage is that approval is difficult. While Rapid Finance doesn’t publish approval requirements, online reviews indicate approval is more complex than they imagined.

    Rapid Finance also doesn’t offer discounts on early repayment. Most of their loans come with fixed fees, so you’ll pay the same amount regardless. Some reports indicate you might qualify for a 20% discount if you pay the loan off in 120 days, but it depends on your financing agreement.

    Rapid Finance Pros & Cons

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    Pros:

    • Easy application process & fast funding.
    • Diverse loan offerings.
    • Excellent online reputation & customer service.
    • Good rates compared to other short-term lenders.

    Cons:

    • Not transparent on fees and interest rates.
    • Doesn’t publish qualification requirements.
    • High cost of financing compared to long-term lenders.

    Apply for business funding through United Capital Source today.

    Rapid Finance Frequently Asked Questions

    Is Rapid Finance Safe?

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    Yes, Rapid Finance is a legitimate alternative business lender with an excellent online reputation. The Better Business Bureau has accredited the company since 2010, and it has an A+ rating. It also has a 4.29 out of 5 rating on 17 reviews, which is outstanding for a BBB rating.

    In addition, Rapid Finance’s Trust Pilot rating is a near-perfect 4.9 out of 5 on 1,822 reviews. The company has a 9.9 out of ten overall rating on Best Company, with a 4.8 out of 5 user rating.

    What Do Rapid Finance Reviews Typically Focus On?

    Rapid Finance has many positive customer and analyst reviews. Most good reviews talk about the ease of the application process and how quickly they received the funds. Many users rave about customer service.

    Some state Rapid Finance was able to get them business funding when other lenders couldn’t. Several customers talked about their representative’s knowledge and how much they seemed to care about their business. Most users expressed they felt taken care of by the customer service team.

    There aren’t many negative reviews, and Rapid Finance actively responds to the ones that come through. Some customers complained about the high fees and cost of financing. Other reviews complained about being denied financing after submitting sensitive information about their business.

    Other negative reviews come from borrowers who defaulted on their loans. In some of these cases, Rapid Finance pursued legal action per the terms of their financing agreement. In most cases, Rapid Finance responded to the negative complaint and came to an amicable resolution with the reviewer.

    What if Rapid Finance Denies My Loan?

    There are several reasons Rapid Finance might deny a loan request. One of their lending partners might deny the request, or their internal underwriting team might deem the loan untenable.

    Your credit score, annual revenue, and business history all play a factor in getting approved or denied. In addition, if cash flow issues make loan repayments difficult, lenders might see the loan as too risky.

    There are also some restrictions by state and industry that could disqualify you from a Rapid Finance Loan. Your denial letter should explain the reason why. If not, or if you’re still confused, you can call Rapid Finance for a more detailed explanation.

    If you were denied and still need business financing, there are many lenders who might consider your loan request. When shopping for lenders, try to find ones that offer funding to companies in your credit and revenue position.

    Many lenders offer similar products to Rapid Finance. You can learn more about loan products like:

    Making Your Decision

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    Rapid Finance is best for companies with an urgent need for financing that are willing to pay to get it. Also, any small business owner who isn’t sure what financing option works best for their company will benefit from the loan offerings and expertise of Rapid Finance.

    Small business owners who want to shop rates and don’t need fast funding might benefit from another lending option. If your business doesn’t require fast funding, you can likely find lower rates from another lender.

    However, the company does offer outstanding customer service and can help you determine the right financing package. Based on customer reviews, loan offerings, and funding time, we rate Rapid Finance as 4.8 out of 5, which is one of the highest ratings for lenders we work with.

    Apply for business funding through United Capital Source today.

    Why Choose United Capital Source?

    Why businesses choose UCS:

    1
    Quick funding options that won’t affect credit
    2
    Access to 75+ lenders with multiple products to choose from
    3
    Financing up to $5 million in as few as 3 days
    4
    1500+ 5 star reviews from happy clients!

    Ready to grow your business? See how much you qualify for:

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