Best Retail Business Loans of 2022

Becky Hanson

Retail businesses have high operating costs every month and a business loan can help fill that gap. We’ve evaluated the best retail business loans based on loan terms, fees, rates, customer satisfaction, and overall quality.

No prepayment and origination fees


Max. Loan Amount

12+ months

Time In Business


Monthly Revenue


Min. Credit Score


If you require cash quickly due to a cash flow shortfall or have a less than perfect credit score, Kabbage could be a promising option.

What we like

  • Borrowers with fair credit can apply
  • No prepayment penalties
  • Streamlined application journey
  • No origination fees

What we don't

  • Late payment fees are applicable
  • Short repayment terms
  • Business assets required

Business loans tailored to your needs


Max. Loan Amount

6+ months

Time In Business


Monthly Revenue


Min. Credit Score


National Funding offers small businesses working capital and equipment financing loans that are suitable for a broad range of businesses, and you could receive approval and funding within 24 hours.

What we like

  • Early payoff discounts
  • Fast approval and funding
  • High approval rates for loan applications
  • Personalized experience

What we don't

  • Daily or weekly repayment
  • High minimum annual revenue

What is a retail business loan?

A retail business loan is designed for businesses selling products directly to the public in a retail setting. This can include (but is not limited to):

  • Retail shops
  • Clothing stores
  • eCommerce stores
  • Grocery stores

Retail business loans are often used by start-ups that need funding to open up their first store or can be used as part of a larger expansion plan for an existing store.

These loans can also be used to purchase equipment or inventory for your store. The lender will look at your financial statements and current credit history before approving any funds so that they know you have enough cash flow to repay them in full when the loan comes due.

What are the requirements for a retail business loan?

The requirements for a retail business loan depend on the lender, but they are generally similar. Here is what they usually look for:

  • Credit scores: A strong credit score can help you get approved for a loan and qualify for better rates and terms.
  • Annual revenue: Lenders often look at annual revenue instead of monthly or quarterly income. Retailers who sell items that don’t require maintenance will likely have less trouble getting approved than retailers who sell items that need repairs or maintenance regularly.
  • Business plan: The lender will want to see a well-defined plan for how you’ll use the loan to grow your business and make it profitable.
  • Collateral: If you don’t have good credit or a solid business plan, the lender may require collateral such as property used by the retail store.
  • Current amount of debt: The lender will want to know how much debt you have. If you have a lot of debt on the balance sheet, it can make it difficult for them to judge whether or not you’ll be able to repay them.
  • Years in business: This will tell the lender how long your business has been operating and whether or not it’s stable. If it’s a new business, there could be more risk involved than an older one with more experience under its belt.

What are the types of retail business loans?

There are many different types of retail business loans. These include:

  • Business lines of credit: A business line of credit is one of the most common retail business loans. This unsecured line of credit allows you to borrow money from the lender when your business needs it. The lender will give you a credit limit, and you can borrow up to that limit when required. You then have several months before you have to repay the loan.
  • Equipment loans: This loan is designed to help businesses purchase new or used equipment. It can be used for everything from forklifts and tractors to computer systems, software, and furniture. Most equipment loans require some sort of collateral such as real estate or inventory, although lenders sometimes offer unsecured versions.
  • Invoice factoring: Factoring allows businesses to sell their accounts receivable (unpaid invoices) at a discount to get cash from the factoring company immediately instead of waiting until customers pay their bills. Invoice factoring is similar to a bank loan because it provides working capital for your business.
  • SBA-backed loans: SBA-backed loans are guaranteed by the federal government and the SBA offers a variety of loan programs to help your small business grow. SBA loans can help you purchase inventory, repair, or build new facilities.
  • Merchant cash advances: A merchant cash advance is a short-term loan that involves borrowing money based on your future sales. These cash advances are often used by retailers who need immediate working capital but don’t want to take on long-term debt.

What are the benefits of getting a retail business loan?

There are many benefits to getting a business loan. Here are some of the most important ones:

  • Flexibility for usage: With this type of loan, you can get the amount of money you need in just a few days. You can use the funds for any purpose, but it’s best to use it for specific purposes such as capital expenses or inventory purchases.
  • Tax benefits: If you use your retail business loan to buy equipment or make other investments, the money you spend can be deducted from your income. Also, the interest will be tax deductible. That could mean reducing your taxes for the fiscal period.

How can you use a retail business loan to grow your business?

A retail business loan can be used for a variety of purposes, including:

  • Purchasing inventory: Without enough inventory to meet customer demand, your store will not be able to sell its products and services. A business loan can help you purchase the inventory needed to keep your store stocked with the goods customers want.
  • Hiring staff: Staffing is one of the largest expenses for most businesses, so hiring enough employees to meet customer demand is essential without having too many workers on hand at any given time. A business loan can help cover some of these costs while allowing you more flexibility in hiring more staff when needed.
  • Revamping your retail store: Suppose you want to expand or change your store’s layout, in that case, you’ll need enough capital to help cover the costs associated with upgrading or remodeling your retail location.
  • Invest in marketing: Investing in marketing is a great way to grow your business. You can use the funds to create marketing materials or pay for advertisements that will help you reach more customers.

How to choose the best retail business loans

Here are some tips on finding the right loan for you:

  • Loan amount: How much do you need? You may want to take out a small loan to purchase inventory or expand your business. You may need a large loan if you buy or build a store or warehouse.
  • Interest rates: Interest rates can vary widely from one lender to another. It’s essential to compare rates and find the one that offers the lowest interest rate possible. The lower your interest rate, the less it will cost you over time.
  • Repayment schedule: The repayment schedule outlines when payments are due and how much each payment will be. It also indicates what happens if you miss a payment or pay late. Look for terms that match your cash flow needs to avoid late fees and penalties.
  • Collateral requirements: Another important factor when choosing a business loan is collateral requirements, which vary depending on the loan product offered by each lender and their level of risk tolerance when lending money to small businesses. If you don’t have enough collateral, you may need to go the unsecured route.
  • Loan fees: Look at all the fees associated with a loan. Some lenders charge origination fees or other upfront charges that can add up over time.