Business expansion is the main reason businesses give for taking out a loan, followed by equipment purchases, and marketing and advertising. There's no doubt that borrowing money allows businesses of all sizes to grow faster, achieving their goals without having to wait to reinvest their profits. However, to benefit from a loan, a business first needs to be able to obtain one.

More than a quarter of businesses responding to a survey by the National Small Business Association said that they were unable to secure the funding they needed. According to an NSBA study, 20% of small business loans are denied due to credit issues. For many businesses, that can leave owners or finance professionals wondering whether it's possible to secure a loan with poor credit or without a credit check.

Can You Secure a Business Loan with No Credit?

Securing a business loan can be challenging to businesses with low credit scores, or with no existing credit history. If your business doesn't have a proven track record of managing and repaying debt, it makes it difficult to demonstrate to lenders that you are capable of taking on a loan.

Fortunately, it's possible to access business loans with no credit check. One way to do this is to choose a secured loan. A secured loan is secured against assets owned by the business, such as property or equipment. This security allows lenders to be less strict with their requirements, which means that a credit check is often not required.

Understanding Business Loans with No Credit Check

Many business loans do require credit checks for both the business and the business owner, but there is another option. The right type of loan and lender can allow your business to borrow money without the need for stringent checks.

Some lenders are more flexible with their requirements for business loans, particularly if you look at alternatives to traditional banks. However, there are potential downsides to accessing a business loan that doesn't require a credit check.

For example, some loans without credit checks will have higher interest rates. The lenders are taking on a bigger risk, so they won't necessarily offer such favorable conditions. Some types of loans, such as government-backed loans, could help you gain approval without being too expensive.

Step-By-Step Guide to Getting a Business Loan with No Credit

If you want to secure a business loan without having to pass a credit check, there are a few options that might help you. Follow these steps to find the right loan for your business's needs:

1. Check your personal and business credit scores to get an idea of your current position.
   
   
2. Assess your business's budget to determine how much you can afford to borrow.
   
   
3. Speak to a loan broker – A broker can help you access loans that aren't on the market, taking your individual requirements into account.

Head to the American Capital Express website to find out more about the types of business loans that might be available to you. We can help you find a loan that works for your circumstances.