By: Top 10 Best Business Loans Staff
Loan types - Invoice financing
Loan amount - Up to $100,000
Repayment Terms - 12 or 24-week plan
Top Pro - Access to loans as soon as the next business day
Top Con - Higher loan rates than industry average
Best For - Small businesses that need to cover gaps in income and cash flow
Fundbox was founded in 2012 in San Francisco, California as a fast financing platform for small businesses. The company provides an easy solution for both small businesses and freelancers who need quick access to operating capital. With a simple application and approval process, Fundbox delivers invoice financing for up to $100,000 in as little as one business day. The company blends technology with finance by connecting their system to prospective borrowers’ accounting software to quickly analyze financial patterns. Clients’ overall business health is assessed, generating a credit rating within a few hours. The company only has access to the business account provided by the client, enabling customers to avoid mixing their business with their personal creditworthiness.
Small businesses and freelancers who need short-term financial relief can benefit from Fundbox. The company differs from traditional invoice factoring because it does not purchase unpaid invoices from their customers, nor does it contact clients who have not paid their invoices. Instead, the company analyzes its borrowers’ financial accounts, automatically offering credit lines to match a business’s outstanding invoices. Users pick and choose the invoices they wish to finance. Those businesses using Fundbox’s service can therefore maintain and grow relationships with customers on their own terms, without the uncomfortable option of bringing in a third-party collector to retrieve invoice payments. This presents a great solution for small businesses and freelancers that operate in industries where uneven cash flow is commonplace.
Many small businesses can find it difficult to receive a short-term loan under $100,000 from a traditional bank, and especially with less than stellar credit. Fundbox can help these companies by providing flexible small business invoice financing for under $100,000 quickly and efficiently. The company focuses on a company’s financials for approval instead of looking at owners’ personal credit. The funds loaned to businesses by Fundbox are not restricted, and can be used completely at the customer’s discretion. Applying and registering for Fundbox is quick and simple.
Instead of a traditional credit check, the company will sync to a company’s accounting software to assign a specialized credit rating within hours. If approved, customers can receive their funds as soon as the next business day, which is helpful for small businesses that thrive on their own financial resilience. The company’s interest rates and repayment terms are also focused on short durations, offering quick opportunities for businesses to alleviate any funding crisis that could arise from unpaid invoices. Should customers repay their financing early, Fundbox will waive any outstanding fees.
Highlights for Fundbox:
• Quick and painless registration
• High approval rate that is independent of personal creditworthiness
• Analyzes finances by syncing with businesses accounting software
• Receive funds as quickly as the next business day
• Repay loans in 12 or 24-week installments
• Borrowers maintain control of customer invoice relationships
• Flexible range of loan amounts
• Transparent payments and interest rates
One of Fundbox’s biggest advantages is their quick and painless application process. To get started, new users are asked to create an account with their email address and phone number. Afterwards, prospective borrowers connect to Fundbox via their preferred accounting software or bank account so the lender can accurately evaluate all the available financial information. The company accepts most major accounting suites, but it is not compatible with Excel spreadsheets.
Businesses whose financial software is not compatible with Fundbox’s platform are asked to instead connect their bank accounts for analysis. Once synced with Fundbox, the company’s unique system will analyze a borrower’s finances and assess their business’s health, assigning them a credit score. When the process is completed, users can request funding, which can be made available as soon as next day. The whole process is incredibly intuitive, and companies can rest easy knowing they are never more than a business day away from the capital they require.
Unlike many of its competitors, Fundbox is focused exclusively on short-term lending. The company’s invoice financing gives customers a swift funding turnaround and repayment term that lasts less than six months. For many smaller businesses, this short-term solution is an ideal way to cover gaps in operating capital that can be detrimental to their growth or raise costs elsewhere.
Thanks to this emphasis on shorter repayment periods, Fundbox’s interest rates can be slightly higher than the industry average. This balances out, however, as companies can usually repay these loans once their invoices have been covered. Fundbox does not charge any fees for prepayment and will waive any remaining fees once loans are entirely repaid.
The company’s fees are divided into two main categories: 12-weeks and 24-weeks, each paid weekly. Fees for the former start at 4.66%, with APRs ranging from 16.40% to 67.70%. It is important to remember that while the rates may seem high, the short repayment terms mean that customers will not necessarily have to pay an exorbitant amount in interest. Fees for 24-week repayment start at 8.99%, with APRs between 18.50% and 76.50%. The company charges flat fees that are spread out over the life of the loan, instead of front loading them, meaning that customers can avoid any outstanding fees if they repay their financing before the term expires.
Along with their flat fees, Fundbox offers quick term durations that help companies exit from debt quicker. The company only offers two repayment terms—12 and 24-weeks. It would be nice to see a wider variety of repayment terms, but the company’s financing solutions are structured to help customers repay financing before the periods expire. Fundbox’s loans are backed by customers’ invoices, so companies can repay the full amount, minus the additional fees, as soon as they receive payment. Moreover, customers can take advantage of Fundbox’s fee waiver to lower the total cost of their loans. To help customers better understand their potential loans, Fundbox hosts a helpful payment calculator based on their rates, making it easy for a potential customer to review what their weekly costs might look like.
Fundbox does not charge origination fees, maintenance fees, draw fees, or bank wire fees, but do charge a fee for late payments. The company uses automated payments directly connected to customers’ bank accounts, but insufficient funds may lead to charges that are triple the weekly fee.
Assisting customers is a major focus for Fundbox, which takes their service quite seriously. The company’s support center features an extensive range of questions that cover more commonly occurring issues to rarer problems. Additionally, customers can email the company, which usually responds within 24 to 48 hours. Fundbox also offers a toll-free line that is available on weekdays between 8:00 AM and 8:00 PM Eastern Standard Time. The company’s support representatives were all well-trained, and capable of answering our queries promptly.
We were extremely impressed with Fundbox’s innovative platform, but identified some areas that could be improved:
• The company’s platform is only integrated with a brief list of accounting software for maximum functionality
• Customers must consent to a background check for themselves and their employees
• The company could add more communication channels, such as a live chat feature
• We would like to see more information on the approval process
Aside from these areas for improvement, there are many features from Fundbox’s service that stood out:
• Customers can receive financing as quickly as the next day
• The application process only takes a few minutes and is mostly automated
• The company’s repayment plans are straightforward and transparent
• Repayments are automatically paid from the business bank account
• Unique and innovative approach to unpaid invoice financing
Fundbox has created a unique platform for small businesses to access financing. The company’s innovative approval system creates a more accurate picture of a companies’ financial health and simplifies the approval process. Their method of automated invoice forwarding is ideal for small businesses and freelancers looking for quick financial relief while maintaining their relationships with clients. For businesses which may struggle to access financing due to personal creditworthiness, Fundbox’s offer of small loans under $100,000 without a standard credit check may prove especially attractive for certain individuals.
Furthermore, straightforward repayment schedules which are automatically debited from the business’s bank account give business owners one less thing to worry about. Small business owners will surely find Fundbox to be an excellent tool for fast and effective financing.
300 Montgomery St, Suite 900
San Francisco, CA
About Top 10 Best Business Loans Staff
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