A quick funding process that offers payroll business loans to business owners.
Last Updated on February 26, 2025
Shield Funding TeamNext to inventory or rent, payroll can be one of the biggest monthly expenses for many business owners. On top of the actual payroll expense companies like Paychex or ADP also charge additional fees. Additionally, payroll costs rarely align with cash flow if you pay your employees on a weekly or bi-weekly basis when your customers only pay monthly. Failing to pay employees on time could lead to angry servers waiting on tables and annoying customers, or good employees just walking out.
If you make the decision to rob Peter to pay Paul you could find yourself in a bad cash flow cycle. You delay paying vendors in order to pay your employees, but then receive late or untimely product shipments, which hurt sales, which hurt your ability to pay your employees…and it becomes a vicious cycle.
This is why small business owners often seek out business loans to cover payroll expenses. It is preferable to stay current with vendors and not experience any delay in receiving product but to also pay employees on time. Business loans for payroll will help you accomplish both and Shield Funding makes it easy to acquire business funding for your payroll expenses. You can apply online and can have an answer as fast as the same day you apply.
What Do I Need to Qualify?
Below is a list of the general requirements to get approved for business funding with our basic program.
How Do I Apply?
Applying has never been easier. You can either call our toll free number 24 hours 7 days a week at:
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A business line of credit or LOC is one of the best options for business owners whose cash flows do not align with the pay cycle. That is because a LOC is renewing. The line is kept open and capital can be accessed whenever you need it, but when you repay it you can borrow against it again. The payroll applications are obvious. Borrow five grand for payroll on Friday, take in your weekend sales, and pay off the line of credit on Monday.
A line of credit’s flexibility is why many financial advisors suggest that all business owners keep one open, just in case. While a line of credit has an upper borrowing limit, like a credit card, it can remain open for one or more years or indefinitely. At some point, some lenders freeze lines of credit and convert them to term loans.
A merchant cash advance or MCA is another lending option to meet your needs. If your sales tend to fluctuate and you know you can repay the loan quickly, then it could be an excellent choice. An MCA is borrowing against your future sales, and repaying the lender out of your future sales. To figure out how much credit to extend you, the underwriter will ask to see credit card or bank statements. From these, they will calculate average cash inflow. They want to know that you have money coming into the business and its frequency, so qualifying for an MCA can be easy and quick.
You don’t repay the advance until you are making money, and an MCA is repaid when you swipe a credit card. The lender takes a percentage which includes their principal and profit of each sale. This form of funding works quite well for restaurants and hair salons with high credit card sales.Interest rates on an MCA can start at 15% and go up from there to the triple digits if looked at on an annual basis. Your agreement could allow your lender to continue to raise the rate if it is taking too long for them to be repaid. A fast business loan, business credit card, or short term business loan could all have a much lower cost of capital and be better for payroll expenses.
This is a short term small business loan that you can use for any type of expense. You can use it to cover seasonal swings in business, pay a new employee, or open a completely new location. You can even receive funds the same day. Whatever you need for your business, these short term business loans will help you get it.
We offer up to $1,000,000 in funds for business owners. And with interest rates of 12–45%, you can get a better deal than you would with some traditional lenders. As long as you’ve been in business for two months, earn $8,000 or more per month, and have a credit score of 500 or more, you can qualify for one of these loans.
Our terms range from 12–36 months, so you can get the amount and terms that work for you. You can also receive funds within 24 hours directly to your account so you can take care of your business needs quickly.
Apply for Payroll Business Loans!
Work with a direct lender and get a business loan as fast as the same day. Shield Funding offers competitive rates and terms on all it’s funding programs. Apply now with a trusted lender that has been helping business owners secure working capital for two decades.
Bank of America’s Cash Secured Business Line of Credit is designed to help small businesses manage essential expenses, including payroll. By securing the line of credit with a refundable deposit starting at $1,000, businesses can access funds to cover payroll and other operating costs, ensuring smooth operations during cash flow fluctuations. Regular, on-time payments not only assist in maintaining payroll commitments but also help establish a positive credit history, potentially leading to an unsecured line of credit in the future. This financial tool is particularly beneficial for businesses with at least $50,000 in annual revenue and a minimum of six months in operation.
Payroll loans are financial products designed to help businesses cover their payroll expenses, especially during times when cash flow might be tight. This type of “payroll” loan simply refers to how one will use the money instead of a particular type of loan. They can be particularly useful for small businesses that experience inconsistent revenue streams or unexpected expenses. These loans ensure that employees are paid on time, which can be crucial for maintaining morale and trust within the company.
You also might want your form of funding to be accessible multiple times. Once a loan is repaid you can no longer borrow from that same loan. To obtain more capital from the lender you would have to fill out another loan application. This could become burdensome if you frequently need to dip into funding sources to make payroll.
It is far better to think longer term and to apply for a form of capital that will cover payroll needs now and in the future. As well, repayment should not further hurt your business but should align better with your cash flows. In short, a business loan for payroll should meet the following criteria;
These goals can be met with several different types of funding options. You should compare each of them to your business need to pick the one that is best for you.
Cash Flow Gaps: There are times when there’s a delay in receiving payments from customers, yet payroll obligations remain. In such situations, a payroll loan can be a valuable tool to ensure timely payment to employees.
Growth Phase: When a business is in an expansion phase, there might be a need to hire new employees or contractors. A payroll loan can provide the necessary funds to cover these additional payroll costs, ensuring smooth business operations.
Unexpected Setbacks: Unforeseen challenges, such as a global pandemic, can severely impact revenue. In these scenarios, payroll loans can be a lifeline, ensuring that employees are compensated and business operations continue. These are just some of the ideas to consider when deciding if a payroll loan is right for you.
It should be mentioned that these are general requirements for most types of business funding. There can be a lot more depending on a particular lender and the type of funding being requested. Here are some of the most common requirements for a payroll loan: Below is a list of the requirements to get approved for business funding with most basic funding programs. There may be additional factors that are considered, meeting these three requirements though gives you a very high chance of having your application approved.
Business Credit Cards: Business credit cards can be an excellent tool for managing short-term expenses. They offer the flexibility of revolving credit, allowing businesses to make purchases and pay them off over time. Additionally, many business credit cards come with rewards or cash-back programs, which can provide added value to businesses.
Personal Loans: In situations where the business might not qualify for a traditional business loan, business owners with strong personal credit can consider personal loans. These loans are based on the individual’s creditworthiness and might offer competitive interest rates. However, it’s essential to remember that the business owner becomes personally liable for the loan.
Equity Financing: Equity financing involves raising capital by selling shares or stakes in the business to investors. This method doesn’t require repayment like a loan but does dilute the owner’s ownership percentage. It’s suitable for businesses looking for significant capital injections and willing to share future profits with investors.
Crowdfunding: Crowdfunding platforms like Kickstarter or GoFundMe allow businesses to raise small amounts of money from a large number of people. This method is especially popular for startups or businesses with innovative products. It not only provides funds but also validates the demand for a product or service.
Grants: Grants are non-repayable funds provided by governmental bodies, non-profit organizations, or private entities. They are often awarded based on specific criteria or for particular purposes, such as research, community development, or innovation. While they don’t need to be repaid, they often come with stipulations on how the funds should be used.
Effective Cash Flow Management: Regularly monitoring and forecasting cash flow is crucial. By understanding the financial inflows and outflows, businesses can better prepare for future expenses and avoid potential shortfalls.
Build an Emergency Fund: Setting aside a portion of profits for unexpected expenses can be a financial safety net. This fund can be used in emergencies, reducing the need to borrow.
Invoice Promptly: Ensuring that invoices are sent out promptly and have clear payment terms can expedite payments. Faster payments can improve cash flow and reduce the need for external financing.
Negotiate Terms with Suppliers: By negotiating extended payment terms or discounts with suppliers, businesses can improve their cash flow. This can reduce the immediate need for funds and provide more financial flexibility.
Diversify Revenue Streams: Relying heavily on a single customer or revenue source can be risky. By diversifying revenue streams, businesses can reduce the impact of a single customer’s payment delay or loss.
You could have all the time in the world or have to move quickly when taking out a business loan for payroll, but either way, take the time to compare your options. Talk to your lender and ask them to help you evaluate your needs and make recommendations. While payroll loans can be a lifeline for businesses facing short-term cash flow challenges, they should be approached with caution. It’s essential to understand the pros and cons, the terms, costs, and implications of such loans and to explore all available options before making a decision.
Approval times vary by lender, but some online lenders offer same-day or next-day approvals, while traditional banks may take a few days to weeks. The speed depends on factors like your business’s financial health, credit score, and loan amount.
Yes, seasonal businesses can qualify, especially if they have a consistent revenue pattern during peak months. Some lenders offer flexible repayment terms that align with seasonal cash flow fluctuations.
No, businesses of all sizes can use payroll loans to manage employee wages. However, loan terms, approval criteria, and funding limits will vary depending on the business’s size, industry, and financial stability.
Yes, many lenders allow payroll loans to be used for both full-time employees and independent contractors, as long as the funds are used for labor-related expenses.
It depends on the lender. Some payroll loans are unsecured, meaning no collateral is required, while others may require business assets, receivables, or personal guarantees to secure funding.
Yes, if you find a lower interest rate or better repayment terms, you can refinance your payroll loan through another lender to reduce costs and improve cash flow. Some lenders also allow early repayment without penalties.
