National Funding vs. SMB Compass: Which Lender Is Right For You?

National Funding vs. SMB Compass: Which Lender Is Right For You?

National Funding and SMB Compass are online lenders offering various small business loan options to companies with fair credit scores. While SMB Compass and National Funding offer quick applications and funding, SMB Compass is a more traditional lender with lending amounts and interest rates you’d find with other conventional lenders, like banks. In comparison, National Funding uses factor rates on some of its loans, which are more common with online and alternative lenders.

Before applying for a loan from either company, take the time to consider your options.

Key takeways

  • National Funding and SMB Compass both offer quick business loans for companies with fair credit
  • National Funding uses factor rates for working capital loans with terms up to two years
  • SMB Compass offers much higher loan limits
  • Choose National Funding for short-term loans
  • Choose SMB Compass for large loans with long repayment terms

National Funding and SMB Compass are online lenders with quick funding timelines. However, National Funding excels at offering smaller, shorter-term loans, while SMB Compass is better if you want larger amounts of financing or a wider variety of loans.

National Funding SMB Compass
Bankrate Score 4.4 4.4
Best for Small, short-term loans Longer-term loans for large amounts
Number of loan products 4 9
Loan amounts $5,000 to $500,000 $10,000 to $10 million
Interest rates Starting at 1.10 factor rate or 4.99% simple interest Starting at 5.25%
Term lengths 4 to 60 months 6 months to 25 years
Personal credit score Over 600 600
Minimum time in business 6 months 6 months
Minimum business revenue $250,000 $100,000

National Funding is an online lender focusing on relatively short-term loans for those with fair credit.

One of its top loan products is its working capital loan. This lets companies borrow between $5,000 and $500,000 for day-to-day expenses or other purposes. Like most short-term lenders, National Funding uses factor rates for these loans, which can significantly increase costs.

That said, National Funding does offer early repayment discounts, which could help you save money if you plan to pay your loans off ahead of schedule.

National Funding also has equipment loans with longer repayment periods — up to 60 months — but only offers loan amounts up to $150,000. And since National Funding has a minimum credit score of 600, bad credit borrowers will need to look elsewhere for financing.


  • Quick application and funding
  • Discounts for quick repayment
  • No collateral required for working capital loans


  • High revenue requirements
  • Low borrowing amount for equipment loans
  • Potential high interest rates

If you’re looking for larger loans or longer terms, SMB Compass might be a better fit, offering loans from $10,000 to $10 million with terms up to 25 years.

SMB Compass offers nine loan types, including SBA loans, equipment financing, secured term loans and lines of credit. You can also use the lender for invoice financing and inventory financing.


  • High loan maximum
  • Long terms available
  • Low rates for well-qualified borrowers


  • Sole proprietors cannot apply
  • High revenue requirements for some loans
  • Not available in every state

National Funding and SMB Compass are similar in offering quick approvals and funding. However, the loans they offer can be quite different. National Funding is a great choice for smaller, short-term loans, while SMB Compass excels in larger loans.

Choose National Funding for short-term loans

Of the two, National Funding is the better choice for short-term borrowing. Most of their loan products have terms under two years, and National Funding also offers discounts for repaying your loan early, which is beneficial in managing a short-term loan.

National Funding is also a good choice for businesses looking for fast funding. Applicants could receive funds in as little as 24 hours, which is often why businesses seek short-term loans.

Choose SMB Compass for accessible, long-term loans

If you need large amounts of financing and longer repayment periods, SMB Compass is the way to go. SMB Compass has nine types of loans with terms up to 25 years with a range of annual revenue and time in business requirements — making them accessible to a wide variety of businesses.

For example, its secured loans, such as its asset-based and equipment loans, have lower revenue requirements of $100,000 compared to National Funding’s $250,000.

SMB Compass also offers larger loans, giving borrowers up to $10 million in financing.

National Funding and SMB Compass are both good choices if you want a business loan, but it’s worth considering other options.

For example, you’ll need to look at other lenders if you have poor credit. Options like Fundible or Fora Financial are worth considering, as Fundible minimum credit score is 450 and Fora Financial’s is 500.

Another type of alternative lender to consider is Kiva. As a microlender, Kiva offers interest-free loans for up to $15,000, making it a good option if you only need to borrow a small amount. That said, it will take more time to fund than National Funding or other online lenders.

Those needing small amounts of financing might also look into business credit cards. Similar to a business line of credit, business credit cards allow you to continually reuse your credit as you repay your debt. If you pay your balance in full every month, you’ll also avoid any interest. Many business cards also come with benefits like rewards or an introductory APR.

SBA loans

If you’re in need of a small business loan and have exhausted other financing, SBA loans are a popular option. Since the U.S. Small Business Administration partially guarantees SBA loans, lenders are often more willing to lend to riskier borrowers, and borrowers benefit from set maximum interest rates.

Most businesses seek  7(a) and 504 loans, which are designed to help businesses with things like working capital or equipment.

If you’re looking to borrow relatively small amounts, you can also consider an SBA microloan or a Community Advantage loan. These programs often have easier eligibility requirements and are offered through local nonprofits or mission-based lenders. SBA microloans have a max borrowing amount of $50,000, and the Community Advantage loan offers up to $350,000.

While SMB Compass offers SBA loans, its eligibility requirements make it difficult to qualify. SMB Compass requires a minimum credit score of 680 and an annual revenue of $500,000 for its SBA loans, making it less accessible to businesses that aren’t established or highly profitable.

Bottom line

Both National Funding and SMB Compass are online lenders specializing in quick loan applications and funding. If you need financing, consider National Funding for small, short-term borrowing and SMB Compass for larger loans with longer terms.

Before you apply for a loan from either company, compare them and any other lenders you’re interested in. Finding the right type of funding for your business can ensure you’re set up for success in the future.

  • There are many ways to finance a small business. The owner can use personal funds to pay for startup expenses, look for investors or apply for financing, such as loans or grants. When starting a business, you’ll find that most use a combination of financing.
  • Yes, for some loan types, National Funding requires a personal guarantee.
  • National Funding’s interest rate starts at 4.99 percent for well-qualified borrowers. Its working capital loans use factor rates, which start at 1.10.