In 2025, small business owners face a unique blend of opportunity and challenge. While inflation pressures persist and interest rates remain a concern, funding is still essential for growth, stability, and innovation. The good news? There are still low interest small business loans available in 2025—if you know where to look.
Whether you’re launching a startup, expanding operations, or just need working capital, this guide breaks down the best low-interest business loan options, who qualifies, how to apply, and tips to secure the best rate possible.
Why Interest Rates Matter for Small Business Loans
Interest rates directly affect the cost of borrowing. For example:
- A $100,000 loan at 6% APR over 5 years costs about $16,000 in interest
- The same loan at 12% APR costs about $33,000
That’s more than double the cost, just due to interest. For small business owners watching every dollar, a low-interest loan can mean the difference between profit and loss.
Types of Low Interest Small Business Loans in 2025
Let’s look at the main loan types offering competitive interest rates this year:
1. SBA Loans (Small Business Administration Loans)
- Interest Rate: As low as 6% – 8.5% APR
- Loan Amounts: Up to $5 million
- Terms: 10–25 years
- Best For: Long-term financing, expansion, equipment purchase
The SBA doesn’t lend directly but backs loans through partner lenders. This lowers the lender’s risk and helps small businesses access better rates and terms.
Popular SBA Loan Programs:
- SBA 7(a) Loan: Most common, flexible use
- SBA 504 Loan: For purchasing fixed assets like equipment or real estate
- SBA Microloan: Up to $50,000 for startups or micro-businesses
2. Bank Term Loans
- Interest Rate: 5% – 10% APR
- Loan Amounts: $50,000 – $500,000+
- Terms: 1 – 10 years
- Best For: Established businesses with strong credit
Traditional banks like Chase, Bank of America, Wells Fargo, and U.S. Bank offer competitive rates—but only to well-qualified applicants with solid revenue and credit histories.
3. Credit Union Business Loans
- Interest Rate: 4.5% – 8.5% APR
- Loan Amounts: Up to $250,000+
- Terms: Flexible
- Best For: Community-based or smaller businesses
Credit unions are non-profit and often offer lower rates and more personalized service than banks. Membership is usually required.
4. Online Business Loans (Fintech Lenders)
- Interest Rate: 6% – 18% APR (for prime borrowers)
- Loan Amounts: $5,000 – $500,000
- Terms: 6 months – 5 years
- Best For: Quick funding, newer businesses, those with decent credit
Top 2025 platforms offering low interest rates include:
- Funding Circle
- BlueVine
- Credibly
- Lendio (aggregator)
- OnDeck (short-term)
These lenders prioritize speed and accessibility, often funding in under 72 hours with less paperwork than banks.
5. Equipment Financing
- Interest Rate: 4% – 10% APR
- Loan Amounts: Varies by equipment
- Terms: Matches useful life of equipment
- Best For: Businesses buying vehicles, machinery, or computers
The equipment serves as collateral, lowering risk and qualifying you for lower rates.
Who Qualifies for Low Interest Small Business Loans?
To qualify for the lowest business loan rates, lenders typically want:
- Good to excellent credit (680+ FICO for owners)
- At least 1–2 years in business
- Solid annual revenue ($100,000 minimum)
- Positive cash flow and profitability
- Collateral (depending on the loan type)
That said, newer businesses can still qualify—especially through SBA microloans, fintech lenders, or secured financing.
How to Compare Small Business Loan Offers
When evaluating offers, don’t just look at the interest rate. Compare the total cost of the loan by analyzing:
- APR (Annual Percentage Rate)
This includes interest + fees. It’s the most accurate number to compare across lenders. - Repayment Terms
Longer terms reduce monthly payments, but increase total interest. - Fees
Look for:- Origination fees (1%–6%)
- Prepayment penalties
- Late payment fees
- Funding Speed
Need fast capital? Online lenders usually fund in 1–3 days. Banks and SBA loans can take weeks. - Collateral Requirements
Some loans are unsecured. Others require business or personal assets.
Best Low Interest Small Business Loan Providers in 2025
Here’s a roundup of top lenders offering low interest small business loans this year:
1. Live Oak Bank (SBA 7a Lender)
- APR: Starting at 6.5%
- Amount: Up to $5 million
- Perk: Top SBA lender by volume
- Best For: Large SBA loans
2. Chase Business Term Loans
- APR: From 6.25% for qualified borrowers
- Amount: Up to $500,000
- Perk: Reputable national bank with strong support
- Best For: Established businesses
3. BlueVine
- APR: As low as 6.2% for lines of credit
- Amount: Up to $250,000
- Perk: Fast approval + flexible funding
- Best For: Working capital
4. Funding Circle
- APR: 6% – 15%
- Amount: $25,000 – $500,000
- Perk: Transparent terms + fast funding
- Best For: Non-bank financing
5. Accion Opportunity Fund
- APR: Starting at 5.99%
- Amount: $5,000 – $100,000
- Perk: Mission-driven lender for underserved businesses
- Best For: Minority-, women-, and immigrant-owned businesses
Tips to Secure the Lowest Interest Rate in 2025
To increase your odds of approval and lower your cost of borrowing:
1. Improve Your Credit Score
- Pay down credit cards
- Correct any errors on your credit report
- Avoid hard inquiries before applying
2. Build a Strong Business Profile
- Maintain detailed financial statements
- Show consistent monthly revenue
- Register your business properly
3. Apply During Peak Lending Seasons
Spring and early fall tend to have more active lending markets. Lenders may offer better terms to compete.
4. Offer Collateral or a Personal Guarantee
Secured loans are less risky for lenders, which can help you get a lower rate.
5. Shop Around and Compare Offers
Use aggregators like:
- Lendio
- Nav
- Fundera by NerdWallet
You can compare offers from dozens of lenders in one place.
When Is a Low Interest Loan Not the Right Move?
While low interest sounds great, not every loan is a good idea. Avoid borrowing if:
- Your business is already overleveraged
- You’re not sure how you’ll repay the debt
- You’re funding untested or unnecessary expenses
- The fees or collateral requirements outweigh the interest savings
Borrowing for the wrong reasons can hurt your business more than help it.
Alternatives to Low Interest Loans
If you don’t qualify for a traditional loan, consider:
- Business credit cards (0% intro APR for 12–18 months)
- Invoice factoring (advance against unpaid invoices)
- Crowdfunding or investor capital
- Grants (especially for women, veterans, and minorities)
- Revenue-based financing
These alternatives can bridge the gap if you’re still growing into loan eligibility.
Final Thoughts
In 2025, small business owners have access to more lending options than ever before. If you meet the requirements, low interest small business loans can help you expand, stabilize cash flow, or seize new opportunities.
The key is to:
- Understand what’s available
- Know what you qualify for
- Compare all terms carefully
- Borrow strategically
When done right, a low interest loan is not a burden—it’s a catalyst for business growth.
