We may earn an affiliate commission from partner links on the Entrepreneur Guide. These do not affect our editors’ opinions.

It isn’t hard to find a bank in the U.S. In 2021, there were 4,236 FDIC-insured commercial banks in the U.S. The exact number of branches fluctuates but typically hovers between 75,000 and 80,000.

Finding a bank might not be difficult, but getting a business loan from one can be. Banks are the least likely lender to approve a borrower’s business loans

In the second quarter of 2021, small and big banks only approved 18.9% and 13.6% of business loan applications, respectively. In contrast, alternative lenders (24.5%), institutions (23.8%), and credit unions (20.5%) all approved at least one-fifth of loan options. 

Bank lenders are notoriously strict when it comes to giving business loans. If you don’t meet their requirements 100%, then it’s doubtful they’ll accept your application. For a bank, a business loan operates like an investment opportunity. 

They provide the money upfront and receive scheduled monthly payments until the original amount is returned, plus a profit. If a financial institution doesn’t think you’ll be able to meet the repayment terms for the loan amounts, then it has no reason to grant your request.

What banks are the best for business loans?

Pretty much all banks are willing to extend various types of loans to small-business owners. The bank can make a lot of money from the subsequent interest payments, and you can acquire the working capital you need for your business. 

As long as you meet their notoriously strict requirements, it should be no problem for your application to be accepted. The hard part will be finding a bank that offers a healthy mix of reasonable rates and accessibility. 

Here is a list of the four best banks for small business loans in 2022:


Bank of America

Learn MoreOn Bank of America’s Website

Bank of America was initially founded in 1904 and has changed many times over the years. In its current state, Bank of America is one of the leading providers of SBA loans and business financing in general. The multiple options for funding, generally low-interest rates, and exceptional customer service make Bank of America an excellent starting point for a business term loan.

The best part about Bank of America is that they disclose a lot of information about their loans. Term loans are available for up to $100,000 unsecured and $250,000 secured. The interest rates are as low as 5.75% and last between 12 and 60 months. Lines of credit are also available with interest rates as low as 4.5% for tight lines and 5.25% for unsecured lines. These options require two years in business and $100,000 in annual revenue. If approved for a term loan, there will be an additional $150 origination fee.

The main drawback to using Bank of America is the slow application process. It’s going to take quite a long time before you know if you’re accepted, which can be very frustrating. There are also strict credit requirements that you’ll need to meet for your loan to be taken. If you don’t have the minimum credit scores required, Bank of America won’t hesitate to deny your application.


Wells Fargo

Learn MoreOn Wells Fargo’s Website

Wells Fargo was founded in 1852 and has been one of the largest banks in America for decades. There is a lot to like about doing business with Wells Fargo. They offer several different types of financing, have an easy application process, offer relatively low-interest rates, and have more than 8,000 branches across the U.S.

Wells Fargo offers SBA 7(a) business loans, SBA 504 equipment loans, and lines of credit. The SBA 7(a) loan and SBA 504 loan can be as high as $5 million and last up to ten years. The lines of credit can be as high as $500,000, and interest rates range from prime + 1.75% to prime + 9.75%.

The main downside of Wells Fargo is that they are strict in terms of credit. If you don’t meet their qualifications, the loan will usually be denied on the spot. Another common complaint is that it often takes a while before the funds are dispersed. You might have to wait a few weeks after your loan is accepted before you get your money.



Learn MoreOn Chase’s Website

Chase has been around in some form or fashion since 1799 and has been a pioneer in the financial industry. More than 200 years after its founding, Chase remains one of the most powerful traditional banks in the country, with more than 5,000 branches nationwide. 

Chase is ideal for small-business loans due to the generally low-interest rates, minimal extra fees, and multiple types of financing. These features are available to startups and established businesses alike. 

Unfortunately, Chase doesn’t disclose much information regarding its financing options or loan products. It is known that they offer SBA 7(a) loans, 504 loans, and lines of credit. Term loans typically last between 12 months and 84 months, while lines of credit need to be renewed every five years. Chase discloses neither the eligibility requirements nor the interest rates for these options.

Chase is somewhat notorious for having a slow application process. There is no option for a quick process, but Chase seems to drag it out significantly. Additionally, Chase has a stringent reasonable credit requirement that will automatically reject many loan applications. To be fair, you’ll be hard-pressed to find many banks with lenient credit requirements.


U.S. Bank

Learn MoreOn U.S. Bank’s Website

U.S. Bank was founded in 1863 and has steadily served millions of customers. It’s now viewed as one of the smallest business-friendly banks in the country. U.S. Bank is willing to work with businesses of all sizes and ages. It currently offers multiple types of financing, reasonable interest rates, minimal fees, and industry-leading customer service.

U.S. Bank does not disclose any eligibility requirement for its business financing. However, it provides much more information about loans than other options. U.S. Bank offers SBA 7(a) loans and SBA 504 loans. Term loans can reach as high as $1 million without information about interest rates or term length. Another popular option is the quick fixed-rate loan that can be as high as $250,000, with interest rates as low as 5.99% and terms lasting up to 84 months.

The main downside with U.S. Bank is that it’s not as widely available as some of the other options on this list. There are only about 2,000 branches across 26 states, most of which are far from the East Coast. The credit requirements are also a bit strict, but that’s a pretty standard issue for the banks on this list.

How can you increase the odds of being approved for a business loan?

The exact requirements of each business lender can vary significantly. What may be an immediate dealbreaker at one place might never come up at another. However, there are a few universal criteria that most lenders will review. Improving these criteria can significantly increase the odds of having your loan approved:

  • Improve your credit score. A bank will look at the first two things during the application process: your personal and business credit reports. If these scores aren’t enough to meet their minimum requirements, then it’s practically guaranteed that your application will be denied. It will take some time to improve your credit score, but it’s the most important thing you can do to improve your odds. 
  • Create a detailed business plan. A business plan is a formal document that illustrates your goals for a business, how you intend to achieve them, and a general time frame. The more details you include in your plan, the more likely a bank will be willing to buy into your proposal. It might not be enough to overcome a poor credit report, but it can give you the edge if they’re on the fence. 
  • Assemble all relevant documents. There are a ton of documents that you’ll need to include with your loan application. Each lender will request different records, but typically you’ll need to provide bank statements, business/personal tax returns, income statements, balance sheets, current budget, and future cash flow projections. It might be a hassle to assemble these documents, but they’re essential for your loan to get approved.  
  • Have a specific purpose for your loan. Ideally, you should include this information in your business plan. However, you should know where every dollar will be spent before you make your request. For example, it can be much easier to secure financing for new equipment than receiving a traditional installment loan. 
  • Be flexible with your request. There are several different types of business loans available. You might not be able to get approved for one that you want, but there’s a chance that you can be approved for a different one. You should be as flexible as possible and be willing to compromise on your loan terms if necessary.


Shop around to get the best offer for a bank loan

Success isn’t guaranteed in the world of business. It takes a million things going just right for you to succeed and one mistake to fail. If you need a business loan from a bank, then it’s overwhelmingly likely that you’ll be denied. Your best bet will be to take a few steps to determine why you were banned and make the necessary changes to get accepted.

It’s also a good idea to shop around the different banks listed above and figure out your options. Each bank is different, and you may meet the qualifications for one while failing to reach them for another. As long as it doesn’t affect your good credit, you should look into as many loans as possible. Getting your funding might take some time, but with enough hard work, you’ll eventually get there.

Information provided on Entrepreneur Guide is for educational purposes only. Your financial situation is unique and the products and services we review may not be right for your circumstances. We do not offer financial advice, advisory or brokerage services, we do not recommend or advise individuals to buy or sell particular stocks or securities. Performance information may have changed since the time of publication. Past performance is not indicative of future results

Share article: