OnDeck Small Business Loans Review

Business Line of Credit

With a line of credit with OnDeck, you could have access to up to $100,000 that you could then draw on when necessary. You would pay an interest rate starting at 29.9% on the funds you borrow, and your line would be replenished as you repaid it. You would be expected to make automatic payments on a weekly basis. It’s a good option for new businesses with low credit or only a year in business, as Ondeck’s minimum credit score is just 600.

OnDeck’s Revenue-Based Financing

If you opted for revenue-based financing for your business funding, you would essentially get a sum of money that is an advance on your future sales. Then you would repay that with automatic daily or weekly installments taken directly from the credit card sales you made each day or week. Remember, these typically have a factor rate associated with them, rather than an interest rate. So you could end up repaying 1.20 to 1.50 times the amount you borrowed. 

According to OnDeck, borrowers who don’t have the prepayment benefit stipulated in their loan agreement would have to pay “75% of the remaining interest that was disclosed in your original loan agreement.” 

For revenue-based financing, OnDeck requires a minimum credit score of 600 and looks for at least $100,000 a year in revenue. 

What Kind of Small Business is OnDeck Best For?

The funding products offered by OnDeck are better suited to some businesses than others. Let’s take a look at who they’re best for. 

Businesses with low credit

When looking for funding, OnDeck is a good option for businesses with lower credit scores. They only require a score of 600, which is lower than that required by other companies that offer funding. 

Businesses looking to build credit

OnDeck reports to major credit bureaus, so if you take financing from them you can expect it to impact your credit score. If you’re confident that you’ll be making on-time payments, you can use it as an opportunity to build your credit.

What Kind of Small Business is OnDeck Not For?

Businesses that can’t make daily or weekly payments

The frequency with which you will be required to make repayments is anywhere from daily to weekly. If this schedule would be a challenge for your business, then OnDeck might not be the right financing option for you. 

Businesses based in Nevada, North Dakota, or South Dakota

OnDeck does not lend to businesses based in Nevada, North Dakota, or South Dakota.

Businesses looking to save by repaying early

As noted above, OnDeck requires that 75% of the remaining interest that was disclosed in your original loan agreement be paid, even if you repay early. Keep that in mind if you plan to save money by repaying your loan early. 

*The information contained in this page is Lendio’s opinion based on Lendio’s research, methodology, evaluation, and other factors. The information provided is accurate at the time of the initial publishing of the page (October 25, 2022). While Lendio strives to maintain this information to ensure that it is up to date, this information may be different than what you see in other contexts, including when visiting the financial information, a different service provider, or a specific product’s site. All information provided in this page is presented to you without warranty. When evaluating offers, please review the financial institution’s terms and conditions, relevant policies, contractual agreements and other applicable information. Please note that the ranges provided here are not pre-qualified offers and may be greater or less than the ranges provided based on information contained in your business financing application. Lendio may receive compensation from the financial institutions evaluated on this page in the event that you receive business financing through that financial institution.