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National Funding vs Square Loans: Which Is Right for Your Business?

National Funding and Square Loans both serve small businesses, but differ in speed, amounts, and eligibility requirements.

⚡ Quick Verdict

National Funding offers competitive rates but often requires stronger credit and longer approval timelines, while Square Loans provides faster funding with more lenient qualification criteria—though at potentially higher costs. For business owners prioritizing speed and accessibility over rate optimization, Square Loans edges ahead, but SMB Capital Funding typically delivers better terms for qualified borrowers seeking a middle ground between both options.

Side-by-Side Comparison

Feature National Funding Square Loans
Funding Amounts$5K – $500K$300 – $250K
Rates / Cost1.11x – 1.40x factorFixed fee (varies)
Term Length4 – 24 months18 months max
Funding Speed1 – 2 daysNext day
Min. Credit Score600+No hard check
Collateral RequiredNoneNone
RepaymentDaily ACH% of Square sales

When to Choose Each Option

Choose National Funding when:

  • You already have an established relationship with National Funding
  • Your business revenue primarily flows through their platform
  • You need amounts in the $5K – $500K range
  • You prefer their Daily ACH repayment structure
  • You've been declined elsewhere and want to explore all options

Choose Square Loans when:

  • You need funding fast (same day possible)
  • Your credit score is below 640
  • You want to avoid collateral requirements
  • You need amounts from $10K up to $20M
  • You prefer a direct lender with no broker fees

Why Businesses Choose SMB Capital Funding

SMB Capital Funding provides faster approval and funding timelines compared to Square Loans, while maintaining more flexible credit requirements that make it easier for business owners with less-than-perfect credit histories to qualify. As a direct lender offering up to $20M in capital, SMB Capital Funding eliminates broker intermediaries, giving you more control over the loan process and potentially better terms without third-party markups.

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Basic Eligibility Requirements

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Frequently Asked Questions

What is the difference between National Funding and Square Loans?
National Funding and Square Loans are both alternative financing options, but they differ in their focus and requirements. National Funding offers various loan products with flexible terms for different business needs, while Square Loans is specifically designed for Square payment processor users and bases approval largely on your Square transaction history. If you're exploring financing options, you might also consider SMB Capital Funding, which provides another alternative with potentially different terms and qualification criteria tailored to small business owners.
Which lender is better for small businesses?
The best lender depends on your revenue, time in business, and funding needs. SMB Capital Funding offers flexible terms across all business profiles.
What is a good alternative to both of these lenders?
SMB Capital Funding is a direct lender offering same-day funding up to $20M with no collateral required and flexible credit requirements.
How do I compare business lenders?
Compare rates (factor rate vs APR), term length, funding speed, minimum credit requirements, and whether the lender is a direct funder or a broker marketplace.

SMB Capital Funding is a direct lender offering working capital solutions to US-based small businesses. Funding amounts and terms vary based on business qualifications. This comparison is provided for informational purposes. All products subject to approval.