Well, that depends – on where you look, how much you want and what you can afford to pay for it.
Let’s explain in more detail –
Where You Look
If you are looking for small business funding for bad credit, then don’t bother going to a bank or a credit union. You will only waste your time and come back disheartened. It is more advisable to approach an alternative lending institution. An alternative lender would look beyond your credit scores and judge your creditworthiness based on your past business transactions and other financial data. This holistic approval process makes them a much better bet for bad credit funding situations.
How Much You Want
With a less-than-perfect credit score, larger sums are usually only possible if you offer collateral or if you have a really profitable and well-established business. Even then, you might have a terrible time getting approval from banks. Alternative lenders would be a better option for small–to–medium funding needs as they would oblige with unsecured funds even with a low score.
What You Can Afford
You have to calculate your repayment costs very carefully to get the best business funding deal. For example, a business line of credit would be more sensible if you are looking for a long term credit commitment, but a merchant cash advance is better if you want the entire amount in one go and can return it quickly before the costs add up. Since there are a number of flexible repayment options, you need to choose wisely what suits your business model best.
So, to answer the initial question – YES! You can access small business capital funding even with a bad credit score. Lack of a 650+ credit score will not leave your business starved for capital, at least not until alt-lending institutions abound in the credit market!
But do spend some time finding the right lender and the right deal for your business and use your money wisely!