At a glance, OnDeck and lending club offer similar loans. Both have similar requirements. They also both offer straightforward rates. Their rates are moderate and they are open to lending money to many different business owners. But there are a few differences that make their loans good in different situations. So, here’s our OnDeck vs LendingClub comparison.
If you have a fair or slightly poor credit score, these are two popular lenders. They are both fast and open to younger businesses. So, we’ll be digging a bit deeper and look into the details.
A Glance At The Candidates
OnDeck is an alternative business lender that offers installment loans and lines of credit. Their options include equipment financing and expansion loans. So, OnDeck can provide loans for many purposes. But what sets them apart is their speed and potentially great rates. While OnDeck can be very expensive for some borrowers, they offer highly qualified borrowers very fast loans starting at a 9% APR. OnDeck can loan you anywhere from $5,000 to $500,000.
LendingClub is a peer-to-peer lending platform for many types of loans. They offer personal loans as well, but in this OnDeck vs LendingClub comparison, we will only consider their business loans.
Like most online lenders, LendingClub offers fast loans to business borrowers with fair or better credit. They aren’t the easiest lender to get a business loan from, though. But they offer rates that are in line with the qualifications of each borrower. Their potential APRs aren’t as high as much of their competitions’. LendingClub provides funding of up to $300,000.
OnDeck vs LendingClub: Which Business Lender Is Cheaper?
OnDeck charges a high origination fee of up to 4% and a $20 per month maintenance fee. These are their only extra expenses on top of interest. OnDeck’s rates vary widely, with APRs starting at 9% for installment loans and 12.99% for lines of credit. APRs on both loan types can rise to almost 99%. The weighted average OnDeck APR is 25.6% for installment loans and 32.8% for lines of credit.
LendingClub is an especially affordable alternative lender. This is in part due to their peer-to-peer nature. APRs on LendingClub range from 7.77% to 35.11%. So, minimally qualified borrowers will find better rates on LendingClub than they will on OnDeck. But LendingClub loans are harder to qualify for.
Overall, LendingClub usually provides the cheaper loans of the two. But be aware that they may charge late payment fees, and paying them by check costs $15.
OnDeck vs LendingClub: Which Business Lender Is More Accessible?
The qualifications for a business loan from OnDeck are:
- Annual revenues of at least $100,000
- At least one year in business
- A personal credit score of 600 or higher
The qualifications for a business loan from LendingClub are:
- Annual revenues of at least $50,000
- At least one year in business
- A personal credit score of 620 or higher
Both of these lenders will look at your debt schedule. Recent bankruptcies or tax liens may disqualify you.
So, OnDeck has a slightly lower credit score requirement, while LendingClub will only lend to borrowers with fair credit or better. But LendingClub’s minimum revenue requirement is only half of what OnDeck’s is.
Overall, LendingClub is a more accessible lender than OnDeck.
OnDeck vs LendingClub: Which Business Lender Is Faster?
OnDeck has a very fast application process. It should only take you a matter of minutes to apply either online or by phone. It typically takes less than 24 hours for applicants to receive their funding from OnDeck. You should always have access to your funds by the end of the next business day.
LendingClub is fast compared to traditional lenders like banks. But the company is quite slow compared to much of its newer competition in alternative lending. Their application process isn’t especially long or complicated and should only take you a matter of minutes. But they take a little while to approve loans. You can expect them to have the funding transferred to you in between 2 to 14 days.
OnDeck is a much faster business lender than LendingClub.
OnDeck vs LendingClub: Who Offers Better Customer Service?
You can reach OnDeck’s customer support via phone, email, or live chat. They can also be contacted on their Twitter and Facebook pages. They typically react promptly and are regarded as helpful by customers. Their customer service reps are friendly and professional.
LendingClub offers customer support by phone or email. The company doesn’t offer as comprehensive a customer support service as OnDeck. But they are still highly regarded. The main complaint customers have is that it can be hard to connect with a customer service rep that can solve their problems.
Reviews from customers on trustworthy platforms such as Trust Pilot and the Better Business Bureau are mostly positive. Both companies are accredited by the Better Business Bureau and offer well-regarded customer service.
We will call this round a tie.
Tallying The Scores
LendingClub can provide better rates than OnDeck. They can also do so with less qualified borrowers.
But if you need a loan very quickly, OnDeck will be the better option. While OnDeck may not seem to offer the better overall deal, they can provide far larger loan sums than LendingClub, and faster.