The two things most small businesses have in common is a need for capital–whether it’s to get through a temporary cash crunch or to fund their expansion–and unpredictable cash flow. Typically, when they need funds in these situations, they need it immediately. If bills or employees need to be paid or a sudden opportunity arises, they can’t wait around for a bank loan that’s unlikely to come through anyway. Investors willing to invest in a business with unpredictable cash flow are scarce, and borrowing from family or friends can become uncomfortable, especially if you need to go back to that well more than once.

To ensure funds will be available when they need them, small businesses need a reliable source of capital regardless of their credit standing or length of operating history. Here are five ways most small businesses can get quick access to capital.

1. Online Business Lenders

Your business might be able to qualify for bank financing, but if you need the capital this week, your best option is with an online lender. Whereas banks can take weeks to approve a business loan, most direct online lenders take as little as 24 hours. They can do this because they have access to mountains of data on your business and the industry, and they use the latest technology to automate huge parts of the underwriting process. From application to loan approval, the process can take as little as ten minutes. Funding the loan could take another day or two.

Online lenders such as OnDeck, Fundera, and Kabbage cater to young, credit-challenged small businesses, offering two- to three-day funding up to $100,000. All you need to show is $50,000 in annual revenue and one year of operation, but they also rely on your personal credit score, which must be 550 or higher (credit scores and annual revenue requirement can vary among lenders). They charge higher interest rates than banks, but their repayment terms are more flexible.

2. Peer-to-Peer Lending

Peer-to-peer (P2P) lending is the fastest-growing segment of the online lending industry. A P2P lender creates a digital marketplace that brings borrowers and investors together. The borrowers are typically people or businesses that are unable to obtain loans through traditional methods. Investors are individuals or institutions that are seeking a better yield on their money than what is available with traditional investments.

Borrowers post a profile of their businesses along with a pitch to attract investors. The P2P lender screens and rates borrowers based on their financial strength and matches them with investors. These investors can select multiple borrowers to create a portfolio of loans to diversify their investments – as little as $25 per borrower. The loan terms are typically short, between three and five years, and the interest rates can range from seven to 35%.

Prosper and Lending Club are the two most established P2P lenders and both cater to businesses with less than great credit. Prosper will make personal loans up to $35,000 that can be used for business purposes. Lending Club has a separate program designed for small businesses with a requirement that the business is at least two years old with at least $75,000 in annual revenue. Business borrowers can request up to $300,000 with loan terms of one to five years.

3. Invoice Factoring

Many small businesses try to avoid carrying any debt on their balance sheet or getting locked into a term loan with interest rates that can eat into their cash flow. With invoice factoring, you aren’t borrowing money. Rather, you are selling your outstanding invoices to a factoring company in exchange for immediate cash worth up to 90% of the invoice value. The factoring company takes on the responsibility of collecting payments based on the original terms of the invoice and then remits the remaining balance, minus a factoring fee, once payment is received. Businesses can control their costs by submitting invoices only as needed.

There are dozens of invoice factoring companies to choose from, but not all factoring companies are the same. Some act as middlemen between a funding source and the business, charging higher fees to cover their own borrowing costs. Others are bank-owned or affiliated so they are their own funding source and can pass cost savings on to their customers. To ensure the most flexibility with your factoring you should work with a company that doesn’t require a minimum number of invoices each month. It’s also important to choose an invoice factoring company you can trust to represent you professionally when they interact with your customers.

4. Asset-Based Financing

Chances are very good that you can get a loan if you have a hard asset that has value and useful life. Of course, the amount and the terms of the loan will be tied to the value and useful life of the asset. Real property tends to have a longer useful life and appreciating value, which can mean a longer loan term and a more favorable interest rate. Equipment tends to have a shorter useful life and depreciating value, so the loan term might be shorter with a higher interest cost.

It all comes down to risk – how much you are willing and able to assume in order for the lender to assume less. The less risk the lender assumes, the more willing it will be to loan you money. The more value and useful life your asset has, the more capital you can borrow and the more leverage you have to negotiate more favorable loan terms.

Of course, the lender will evaluate all of the usual factors, such as credit history and financial stability, which can take some time; but even if neither is deemed to be in great standing, a loan collateralized by hard assets is has a stronger likelihood of going through.

It is important to consider the possibility that you are likely to lose the asset if you default on the loan, which could be a game-changer for you or your business. You must decide if you’re willing and able to take that risk.

5. Merchant Cash Advance

For businesses that can’t qualify for other types of financing, or that don’t necessarily invoice their customers (i.e. retail operators or online retailers), merchant cash advance lenders can provide easy and quick access to cash based on their future credit card receipts. The lender will advance between 50 and 250% of your monthly credit card volume. Requirements include at least three months of operation and minimum monthly credit card receivables, typically around $2,500. Merchant cash advances are the most expensive form of financing and should be used only as a last resort. RapidAdvance is one of the market leaders in this space, offering an online application and 24-hour approval.

To Sum It All Up

While these are all fast and easy ways to access capital for your business, in the long term, it’s important to establish a relationship with a business bank where interest costs can be lower. For businesses with solid but fluctuating cash flow, a bank line of credit is typically the best funding solution. For businesses with expansion plans, a fixed-term loan might be the best option. It may take time to get your business in a position to work with a bank, but that should be your ultimate goal.

Grey Idol manages content and digital marketing initiatives for altLINE, a division of The Southern Bank Company. altLINE offers specialty commercial lending products to businesses nationwide.

Funding stock photo by