OnDeck Capital is a financing provider that offers a short term line of credit product to small businesses. OnDeck offers both loans (up to $500K) and lines of credit (up to $100K). Their minimum qualifications are $100K+ in annual business revenue, at least 1 year in business history, and a 500+ credit score. OnDeck’s application is quick and easy, taking place 100% online in about 10 minutes, and they can get you funded in 1-3 days.
OnDeck Reviews: Terms, Qualifications, & Costs
OnDeck is one of the premiere short term online lenders, and their customers praise their speed and response. An OnDeck loan is easier to qualify for than Kabbage, their biggest competitor, but their line of credit product is a little more difficult. The table below shows the typical terms, qualifications, and costs, that you’ll see if you choose to partner with OnDeck to get a short term loan.
OnDeck Loans Terms & Qualifications at a Glance
|Loan Amounts||$5K - $500K|
|Estimated APR||30% - 50%|
|Loan Term||3 - 36 Months|
|Funding Speed||1-3 Days|
|Time in Business||1+ Year|
|Annual Business Revenue||$50K+|
Who is an OnDeck Loan Right For?
Typically, an OnDeck loan is sought out by small businesses looking to fill a working capital need for a very short term (12 months or less). If you’re a seasonal business looking to ramp up inventory, or in need of purchasing a piece of equipment before you get the money in, then OnDeck could be a good fit.
An OnDeck loan can also be a good fit for prime borrowers looking for short term capital, who don’t want to deal with the headaches of a traditional financing partner. Banks and other traditional lenders will typically require a lot of paperwork, and take you away from your business to provide paperwork and take phone calls from their underwriting team. OnDeck offers an easy solution where you fill out an easy 10 minute online application and get funding in as quick as 1 day after that.
This is not a long term financing solution. If that’s what you need for your business, and you have a 680+ credit score and 2+ years in business, then you should consider an SBA loan. SmartBiz is our recommended SBA loan provider for up to $350K in working capital funding.
OnDeck Reviews: Costs
A OnDeck loan can be costly, with an average APR range of 30-50%. You would think that this would frustrate customers, but the costs actually sound higher than they actually are. If you only have a short term capital need then it’s much cheaper to use an OnDeck loan and pay it back within 6 months, than it would be for you to get a bank loan that you pay interest on for 5 years. The total cost of capital is less for the short term loan borrower, as long as you can make the payments.
It should be pointed out that while OnDeck has no prepayment penalties, you’re agreeing to a set amount that you’re going to pay OnDeck when you originate the loan. This means that no matter when you pay it off you still must pay the full fee amount.
OnDeck Reviews: Customer Satisfaction
Customers seem to really like OnDeck, even with their high APR. They have a very high approval rating pretty much anywhere you look online. Customers love both their product and the way they’re treated as customers. In Fact, the BBB has given them an A+ rating. Here is how their customers have rated them around the web:
Summary of OnDeck Customer Reviews
|Reviewer||Rating||Number of Reviews|
Negative OnDeck Reviews
The majority of their negative reviews are related to individuals that didn’t get approved. It’s unclear what these borrowers qualifications were, but some of them complained that OnDeck didn’t give them an answer and instead didn’t respond to them once they knew they weren’t getting approved. This is common in lending companies with account executives making more per deal they close. Most of OnDeck’s actual customers give them glowing reviews for both their product and their customer service.
OnDeck has many competitors, from traditional banks to specific financing lenders. Their main competitors are other online lenders looking to loan money directly to small businesses. Some of these competitors include:
Kabbage is often compared to OnDeck, because they offer loan products that look similar in speed, qualifications, and price. Kabbage offers only a line of credit product with varying APRs that typically fall in the same 30% – 50% that OnDeck’s loan does. Like OnDeck, Kabbage can also fund your business in 1-3 days.
- Lending Club:
Lending Club is a peer to peer financing company that allows individuals to invest into the products they loan out. They offer both personal loans and small business loans. Their small business loans have become their primary focus over the last few years. Their loans are slightly cheaper than Kabbage loans, but take an average of 7 days to fund.
Prosper is primarily a personal loan company, but their loans can be used for small businesses. Their process is easy, and their fees are straightforward. They can get you funded for up to $35,000 quickly, and the entire process is managed online.
BlueVine offers a line of credit product and an invoice factoring product for businesses with outstanding invoices. With invoice factoring you don’t have to make any payments until your customer pays off the invoice. Their line of credit product is only available in 43 states, but their pricing and time to funding are competitive with OnDeck. You can borrow up to $100K with a BlueVine LOC.
The Smart Hack
OnDeck has become a company that is highly respected within the financing industry, by their current customers, and by their former customers. While their APR is high, the short term nature of their loan product offsets that in the total cost of capital, if you can pay back the loan within 1 year. If you’re looking for up to $500K in financing within the next 1-3 days then OnDeck could be the right option for you. Find out today by applying, which will only take about 10 minutes.