During the 2008 recession, online lenders gained prominence as an alternative option for many small businesses to obtain financing when traditional bank funding opportunities dried up. Since then, these lenders have become a common-place resource for business funding.While your specific needs should dictate where you seek financing, there are some well-known advantages to using alternative lenders, including:

Qualification Requirements: Alternative lenders tend to have less stringent requirements for approval. Typically, alternative lenders have lower requirements for an applicant’s revenue, time in business, and credit score.

Shorter Timelines: Because of the applications are shorter and fewer documents are required for underwriting, alternative lenders can review, approve and fund business loans in a matter of days – sometimes even in as little as 24 hours depending on how quickly you’re able to get your full application package submitted.

Loan Size Flexibility: Alternative lenders have more flexibility with the funding amounts they will approve, so they are able and willing to finance both smaller and larger amounts than traditional lenders. For example, many banks will not consider loans above $1 Million and the use of those funds is often limited. However, with many alternative lenders, loans are available in amounts up to $5 Million and the funds can be used for any business purpose. If you need less capital, many banks aren’t as willing to lend out lower amounts because it is not economically feasible for them to do so, while alternative lenders are willing to finance amounts as low as $10,000.

Higher Approval Rates: Because of their easier qualification requirements and simpler application process, alternative funders approve financing for more small and medium-size businesses than traditional lenders.