Disclaimer: Information in the unsecured business loans articles is provided for general information only, does not constitute financial advice, and does not necessarily describe Biz2Credit commercial financing products. In fact, information in the unsecured business loans articles often covers financial products that Biz2Credit does not currently offer.

Unsecured business loans offer funding to small and large businesses without requiring a collateral asset. These unsecured loan proceeds can be used to fund various business needs, whether you’re looking to expand and scale up operations, cover or consolidate existing debt, acquire another company, pay for new equipment or talent, market your business, and more.

While there are many benefits to unsecured business loans, these types of loans aren’t right for every business or situation. Here’s a look at some of the businesses and industries that are poised to benefit most from unsecured loans in 2025 and what they stand to gain.

While unsecured financing options can benefit most companies, some industries could gain even more than others in the coming year.

Technology Startups

Unsecured business loans give businesses access to lump sum funding without the need for a collateral asset. This makes them ideal for new businesses that need to borrow money but don’t yet have eligible assets to secure a loan, like tech startups.

There are more than 5,700 tech startups in the U.S., earning America the title of the largest tech market in the world. Things in the tech world move fast, though, so these companies need quick working capital to make moves and stay competitive. With an unsecured loan, these startups can

• cover operating expenses
• purchase equipment
• rent office space
• conduct research and development
• hire and pay employees
• market the company

By opting for an unsecured debt, the startup can avoid putting any business assets (that a new startup likely doesn’t have anyway) down to secure the loan.

E-Commerce and Retail

Retail businesses have some of the smallest startup costs on average, but that doesn’t mean that they won’t need a business loan or business line of credit to grow, keep up with orders, and stay competitive. Whether your small business operates out of a brick-and-mortar store or does most of your business online through e-commerce, an unsecured loan can help you grow.

E-commerce and retail businesses can use unsecured business funding to:

• Rent storage or retail space
• Purchase and manage inventory
• Market online
• Buy shipping supplies and postage
• Pay employees to help package and ship

The larger the retail company gets, the more help and on-hand inventory it will likely need, so an unsecured loan can help things stay moving. A recent study found that payroll is one of the biggest expenses for any startup, with the average cost of hiring and keeping five employees costing over $300,000 per year. Without that cash on-hand, unsecured small business lending can keep you moving and growing even if you don’t have collateral to provide.

Health and Wellness Industry

The health, healthcare, and wellness industries have been some of the strongest and fastest-growing in the U.S. in recent years, and the trend is likely to continue. These industries might include healthcare startups, wellness clinics, spas and medi-spas, health facilities, tattoo and hair removal, gyms, and more, all of which could benefit from an unsecured term loan.

Business owners in the health and wellness industries can use unsecured financing solutions to

• invest in new equipment
• rent and/or build out a facility or expand an existing facility
• pay employees
• hire teams for research, marketing, and compliance
• market products and services

Creative and Digital Marketing Agencies

The creative and digital marketing agency space has seen growth of more than 54% since 2018, with more and more businesses relying on agencies to help them grow. An unsecured business line of credit or loan can help these businesses keep up and grow, market themselves, purchase equipment and software, hire talent, and bridge cash flow gaps.

Hospitality and Travel

The COVID-19 pandemic deeply impacted the travel and tourism industries, but the rebound post-pandemic has been significant. The hospitality industry encompasses a wide variety of businesses, many of which are experiencing strong growth.

Borrowers in the personal and business travel or hospitality industries can use unsecured small business loans to expand, market, and keep up within this rebounded industry. This might mean investing in marketing campaigns to attract travelers, renovating and expanding facilities, hiring staff, or just covering payroll and other expenses in slow seasons.

Construction and Real Estate

The real estate industry has experienced exponential growth in recent years and is expected to continue this pattern through at least 2030. Between booming real estate agencies and brokerages, construction of new single- and multi-family homes, and even commercial construction, it’s easy to see the benefits of unsecured business loans.

With an unsecured loan, these companies can fund new projects, purchase equipment, hire workers, and even manage cash flow while waiting for delayed payments.

Manufacturing and Supply Chain

Globally, the manufacturing and supply chain management markets are expected to grow over 11% annually from 2024 to 2030. This explosive trend and increased demand for manufacturing, especially within the U.S. as federal conversations of tariffs continue, shows how competitive this evolving industry will be.

Small business owners can leverage small business loan funds to purchase equipment, buy materials, build warehouses and factories, hire workers, and even manage logistics. Rather than take on a secured business loan with a collateral asset, these unsecured loans and lines of credit offer creditworthy borrowers access to quick cash for any number of uses.

What Can Unsecured Business Funding Be Used For?

The benefit of unsecured business borrowing is that it can be used for almost any purpose. Regardless of your industry or operational needs, an unsecured loan or business line of credit offers you the flexibility to make payments and purchases as you see fit without the funds being tied to any specific use.

Like a business credit card or even a merchant cash advance, you can spend the money when and where you want on almost anything your business needs. Like a secured loan, though, this fast funding option has set repayment terms and a competitive interest rate, so you can take advantage of affordable monthly payments and a lower-cost loan.

Where Can You Get An Unsecured Business Loan?

Unsecured business funding options are available through many banks, credit unions, and alternative lenders. They are generally aimed at corporations and small businesses, including LLCs, though some sole proprietors may be approved.

If you want to snag the best unsecured business loans and highest loan amounts, you’ll need to meet certain eligibility requirements. As part of the application process, your lender may look at factors such as your:

• Business’s annual revenue
• Company credit history and credit score
• Cash flow reports
• Business plan
• Previous tax returns

In some cases, a lender will also look at your personal credit history and may even ask you to sign a personal guarantee for the funds (since there is no collateral asset). This is especially true if you have no business credit score yet or your company doesn’t meet the lender’s minimum credit score requirement.

Some loans may require an upfront down payment, though this is usually limited to loans backed by the Small Business Administration (SBA). While SBA loans have more stringent requirements, they also offer higher loan limits than many banks or online lenders, especially if you have good credit.

What to Consider When Shopping for Unsecured Loans for Small Business

Not sure where to start your journey for a small business unsecured loan? Here are some things to look for and keep in mind along the way.

• Your loan or credit limits. Whether you’re taking out an unsecured loan or line of credit, knowing how much you need to borrow can help you narrow down your list of lenders.
• Available interest rates. Unsecured loans often charge higher interest rates than loans secured by business or personal assets. Even still, locking in the lowest possible rate will save you money in the long run.
• Your creditworthiness. The better your credit history and the higher your credit score, the better unsecured business lending opportunities you’re likely to receive. Some lenders will want to see not only your business credit but also your personal credit score through the credit reporting bureaus (Experian, Equifax, and TransUnion). If you have bad credit or a limited history, expect higher rates and more limited loan options.
• Loan fees. Not all lenders charge application and/or origination fees, but these can add to your overall cost of borrowing.
• Lender reviews. Whether your shopping for your business loan through a member FDIC bank or an online alternative lender, spend some time reading customer reviews on sites like TrustPilot. This will give you an idea of how the lender operates, how their customer service team performs, and how long it’ll take to get your loan funded.

Final Thoughts on Unsecured Business Loans

Unsecured business financing can be an incredibly useful tool no matter which industry your business operates in. Unsecured loans give you a collateral-free funding option to help foster business growth and innovation, whether you’re just getting started or are looking to expand to meet consumer demand.

If you’re a newer company without many assets or business financial history, lenders might approve your unsecured loan application using your personal credit score instead. Be sure to read any loan disclosures to fully understand what you’re paying and what’s expected of you over the course of the loan.

FAQs

Can I take out an unsecured business acquisition loan?

Generally speaking, it’s very difficult (if not impossible) to take out an unsecured business acquisition loan when trying to buy another existing company. In fact, many acquisition loans will require not only business collateral but also personal collateral of some kind.

Can I get an unsecured business loan with an EIN?

Your Employer Identification Number (EIN) is often sufficient when taking out a small business loan. If the loan is unsecured and your business doesn’t qualify on its own, you may also need to provide your personal Social Security number (SSN).

Does my EIN have a credit score?

Business credit scores are generally attached to the company’s EIN. Business credit bureaus will track and report company activity such as opened loans and lines of credit, payment history, and more. This information helps build your business credit history, similar to the personal credit history tracked by the consumer credit bureaus.

Can I take out a small business loan with no collateral?

Unsecured business loans are available without needing to secure the debt with collateral assets. Since these loans are considered higher risk for lenders, they may have more stringent credit history thresholds and even require a personal guarantee to qualify.

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