For years, bad credit could damage a business before it even began. Bad credit could limit the ability for a merchant to obtain a bank account, a plastic card processor, or a business loan. Bad credit could also limit one’s ability to rent a building. Bad credit was once something that could have you turned away even before your idea was heard, but today things have somewhat changed. While mainstream banks and processors still look at bad credit as a turn-off, more and more “off the cuff” processors are embracing these merchants, and the ideas that they possess.

Those with bad credit still believe that there is no way that they can obtain a business loan with bad credit. Some turn to relatives and friends that can help out financially. Some turn to social media and “crowdfunding” sites, such as GoFundMe. While this can be a good idea for some, for others it can be a lengthy process. For those who need a small amount of funding, a GoFundMe campaign can help. But, for whose needed $10,000 for example, it can be a lengthy and disappointing process. With GoFundMe there are no strings attached, but for other crowdfunding sites you must provide donors with something in return. A $50 donation may result in a free product, which can quickly put a bind on your already struggling business.

While a bad credit business loan is possible – and the main option for most struggling merchants – you need to be sure that the lender is experienced in your industry. Not all are, and while some tolerate the issues with some businesses, they may not with others. What most lenders do not understand is that their payment model hurts businesses. With a business loan, you must start repayments almost immediately. When a business is struggling, this can be a tough task, and interest rates rise with each late payment. Instead of heading to the nearest bank for a business loan, contact your merchant account processor. Many provide business loans or business funding to help their struggling clientele.

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