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Uber and Lyft have cornered the market on ridesharing, but they are struggling to find funding. If you’re an entrepreneur looking for other ways to finance your ride-sharing business, these 10 options will be sure to help you out.
Uber & Lyft financing is a great way to fund your ride-sharing business. Here are 10 ways to fund your rideshare business.
Vehicle rentals, company loans, personal loans, and credit cards are among the Uber and Lyft funding options. Uber and Lyft collaborate with vehicle rental firms but do not provide drivers with direct financing options. Drivers must deal with an independent lender to finance car repairs, automobiles, and everyday expenses like food and petrol.
What Is Uber Financing and How Does It Work?
Uber has never given drivers auto loans. They operated a car leasing scheme named Xchange Leasing for a limited time. The FTC filed a complaint because the rates were exorbitant, driver credit was not taken into account, and payments were withdrawn straight from income on a monthly basis. Uber finance was discontinued, and Uber vehicle rentals for drivers were introduced in its stead.
Uber finance is a set of agreements between Uber and rental businesses such as Fair, Getaround, and Hertz through which drivers may borrow a vehicle. Hourly, daily, weekly, and monthly rentals are offered, with prices varying by automobile and city. It’s a great option for drivers who want to try their hand at Uber or ridesharing companies that require a car while their own is being serviced or repaired.
For Whom is an Uber Car Rental Appropriate?
Uber’s car-rental service is suited for particular types of drivers, such as:
- Those who desire to take a risk-free Uber ride: Every city in the United States has a distinct degree of demand for Uber drivers, and each area pays a different amount per hour. Drivers may test if a long-term investment in a ridesharing company is right for them by renting a car.
- Drivers who are unable to purchase an eligible vehicle: Auto business loans may be rather pricey. Auto insurance, loan payments, down payments, and miscellaneous fees are all included in these expenditures. Renting a vehicle via Uber might help drivers save money or eliminate these charges.
- Those looking for a car that satisfies certain criteria: It might be tough to qualify for a typical vehicle lease or financing. Renting a vehicle might be a terrific option if you don’t have enough money, a good credit score, or you’re having other problems.
- Those that need a temporary replacement car include: You may not want to lose out on possible money while your car is being fixed if you currently drive for Uber. While you wait, renting a vehicle to drive for a few days might help you make money.
Uber’s car rental service allows new and experienced drivers to rapidly get a vehicle to complete journeys. New drivers may utilize the program to try out Uber or supplement their income on weekends. If your vehicle is in the shop, you may avoid missing days by hiring substitute vehicles for a few hours or days.
Costs of Uber Car Rental
Uber gives drivers the option of working with one of three rental firms. Working with an unauthorized rental firm, according to Uber’s website, might result in your account being suspended. Hertz has the highest weekly prices, while Fair is the only business that levies a non-refundable start fee. Getaround is the only rental firm we looked at that provides drivers with an hourly car rental option with no security or start cost.
If you drive full-time with a rental vehicle, you may be eligible for Uber incentives that might help you cover the cost of your rental car. In certain areas, making 70 trips in a week will earn you a $185 bonus, which is enough to pay the cheapest Fair rental. Completing 120 rides in a week will earn you $305, which can be used to defray the cost of various Uber vehicle rental alternatives.
Terms and Conditions of Uber Car Rental
Every rental provider that works with Uber provides commercial car insurance, roadside assistance, and basic maintenance with every vehicle rental. You may plan your rental around how long you’ll need the car, which might range from a few hours to many weeks. There are no mileage limitations, and the cars may be rented in 26 major cities, with many of them offering all three rental choices.
Uber Car Rental Requirements
Uber must first authorize you as a driver before you may participate in the Uber vehicle rental program. You must also fulfill the age minimum for renting a vehicle, which may be as young as 19 years old but varies by state and city. There is no minimum number of rides; however, completing less than 20 rides will usually not be enough to pay the rental costs.
What Is Uber Car Rental Lacking?
Uber’s automobile rental service provides a cost-effective way for drivers who don’t have access to a vehicle or who don’t qualify for financing to get on the road sooner. It is, however, costly, and you must commit to earning enough to pay the rental and gasoline expenses. Unlike corporate and personal automobile loans, you will not own the vehicle no matter how long you rent it.
How to Request an Uber Car Rental
To apply for an Uber rental vehicle, you must first qualify as a driver and get Uber clearance. After that, you may fill out an online form with your personal information to get a quick price from the rental provider. In certain places, the automobile may even be brought to your door so you can climb in and start riding.
What Is Lyft Financing and How Does It Work?
Lyft does not provide vehicle loans or leases to its drivers. Lyft, on the other hand, created Express Drive in reaction to Uber’s rental service. Drivers may borrow a car for the week and collect fares from Lyft passengers on the same day they applied. Weekly fees begin at $185, with Lyft offering a bonus of the same amount to drivers who complete more than 70 trips each week.
Who Is a Good Candidate for Lyft Financing?
Certain types of drivers will benefit from Lyft Express Drive, including:
- Those who want to try their hand at the ridesharing industry should: Drivers may hire a car and see how much money they can make with Lyft before deciding whether it’s the correct option for them.
- Drivers who wish to cut their Lyft driving expenses in half: Leasing or owning a car might have significant upfront fees. New drivers may lower their initial expenses of beginning a ridesharing company by renting a car.
- People who are unable to get alternative types of financing: If you have a bad credit score or inadequate proven income, getting a car loan is difficult. Using the Lyft Express Drive service to rent a vehicle is a much more convenient option.
- Experienced drivers in need of a new vehicle: As a Lyft driver, you must maintain and repair your car on a regular basis. Renting a car during that downtime is a terrific method to supplement your income.
The Lyft Express Drive program expands the opportunities for new and current Lyft drivers to earn money and get on the road. New drivers may try out the platform and get on the road for a cheap initial investment. Lyft Express Drive allows experienced drivers to go back on the road while their car is being repaired or if they need a temporary substitute for another reason.
Costs of Lyft Financing
In key cities around the United States, Lyft collaborates with Avis, Flexdrive, and Hertz to provide rental automobiles to drivers. Pricing begins at roughly $185 per week, and if you bike 75 times each week, you may be eligible for reimbursement. There are no non-refundable fees; however, the security deposit necessary to drive varies per business and depends on the car you pick and your area.
Terms of Lyft Financing
All of Lyft’s rental firms need weekly rentals, which might limit flexibility compared to certain hourly choices given by Uber finance partners. All rental businesses provide insurance, roadside assistance, and basic maintenance, so you can concentrate on your events rather than worrying about your car. You won’t be restricted by miles, and the service is offered in 42 major cities.
Qualifications for Lyft Financing
All Lyft Express Drive drivers must be at least 25 years old and provide at least 20 trips each week using a rented car, according to the company’s requirements. This may be a barrier to admission for younger drivers, such as college students trying to supplement their income while attending classes. Lyft drivers, like Uber vehicle rental drivers, must be approved before using the service.
What’s Missing From Lyft’s Financing
Lyft provides drivers with a high amount of freedom and the ability to get on the road for a cheap initial investment, but it is not a smart long-term option. There isn’t much margin left for drivers with monthly bills frequently surpassing $1,000, not to include gasoline costs and your time. Your monthly payments will be substantially cheaper if you qualify for a personal or company loan to purchase a car.
How Do I Get Lyft Financing?
You must first qualify as a Lyft driver before applying for Lyft Express Drive. This process may take a few days as Lyft checks your driving record. Then, based on the car you choose, you may get a quotation for your city and begin driving the same day. Many rental businesses will transport the car to your place, although this service is not accessible in all cities.
How We Assessed Rideshare Company’s Financing Options
Uber and Lyft drivers need funding to purchase new cars, pay for maintenance and upkeep, and cover recurring expenditures such as gas. Fleet owners must also fund huge fleet and garage expenditures as well as working capital to keep their businesses running 24 hours a day, seven days a week. These use cases need cost-effective, easy-to-qualify, and equitable financing options that provide ridesharing companies flexibility.
We compared the top ridesharing company funding solutions using the following criteria:
- Uber and Lyft drivers are small company owners that need personal and business credit cards, working capital, vehicle finance, and personal loans to run their businesses. In order to expand swiftly in big cities, larger fleets need long-term finance and revolving lines of credit.
- Overall cost: For every firm, the cost of financing is a deciding element. We picked alternatives that have a variety of upfront and continuing financing fees to suit the budgets of individual drivers and fleets.
- Credit scores are one of the minimum requirements for financing products such as personal loans. Company loans are only available to those that have a significant yearly income and have been in business for a long period. Finding the correct match might help you save time when it comes to applying for grants and waiting for funds.
- Terms of repayment: Even if you qualify for the money, you must repay it at a reasonable pace. Borrowers wishing to save expenses and meet a short-term requirement might take advantage of short-term loans. Borrowers might use longer-term loans and revolving lines of credit to cover unforeseen needs and significant projects.
Alternatives to Uber and Lyft in terms of ridesharing finance include:
HyreCar
HyreCar, a peer-to-peer ridesharing car rental service accessible nationally, provides an option for drivers. Rates are often cheaper than those offered by other rental firms, ranging from $25 to $40 per day. The car has a mileage limit and no roadside assistance or maintenance is offered. It just takes a few minutes to apply, and drivers may choose a car and be on the road the same day.
Costs
The following items are included in the cost of a HyreCar rideshare vehicle rental:
- Rental rates range from $25 to $40 per day on average.
- Rental rates range from $180 to $250 per week on average.
- Security deposit: $200, which is waived if you pay with a credit card.
HyreCar is a low-cost option for rideshare drivers who want to hire a car and get on the road. Other drivers determine the pricing, with some rental firms matching weekly rates. HyreCar has no upfront costs, and drivers who advertise cars often provide discounts for longer rentals.
Rental Terms
The following are the conditions of a HyreCar rideshare automobile rental:
- One-day minimum rental duration
- Liability, property damage, and driver injury protection are all covered by insurance.
- The daily mileage limit is 250 miles, although it changes according to the owner.
- There is no roadside help available.
- No, basic maintenance is not necessary, but automobiles must be in excellent working order.
HyreCar has fewer features than many of the major automobile rental firms, but it does require owners to keep their cars in good working order. It also provides supplemental insurance coverage that is equivalent to that provided by automobile rental businesses and is accessible across the United States. This final feature makes it an excellent choice for drivers who do not live in one of the big cities where Uber and Lyft rental programs are available.
Qualifications
The following are some of HyreCar’s ridesharing vehicle rental qualifications:
- Age: You must be at least 21 years old.
- Valid in-state driver’s license for at least one year
- An account with a rideshare company: A valid Lyft, Uber, or other rideshare company account is required.
- In the previous three years, there have been no serious infractions.
- In the previous three years, there have been up to two minor breaches.
Drivers will find qualifying for a vehicle rental with HyreCar to be as simple as qualifying for car hire with other providers. Drivers must have a valid driver’s license in the state they are renting in for at least one year in addition to being accepted by a ridesharing business.
Cons
HyreCar is a fantastic peer-to-peer ridesharing automobile rental business that is accessible all around the country and has a vast selection of vehicles. Premium automobiles, on the other hand, maybe costly, and daily mileage might be limited. It is, nevertheless, the greatest option for drivers who need a rental vehicle outside of the service region of major Uber and Lyft partners.
Reviews
HyreCar gets varied evaluations from users on the internet, owing to the marketplace aspect of the service. Favorable reviewers were pleased to make additional money by renting out their vehicles to drivers, and they had a generally positive experience leasing a car. Drivers that had an unpleasant experience owing to a dishonest car posting left some critical feedback.
How to Obtain a HyreCar
It’s easy to apply with HyreCar, and it only takes a few minutes. In seconds, drivers may join up and explore nearby autos. HyreCar validates a few information when a pick is made, including a driver’s license, proof of identification, and ridesharing credentials. Drivers are then ready to pick up their car from the owner and hit the road.
Upstart
For Uber and Lyft financing, Upstart provides a personal car loan of up to $50,000, which is ideal for independent drivers looking to finance their first ridesharing vehicle. To qualify, you must have a credit score of 620 or above, and rates start at 7.54 percent with three to five-year payback periods, making it feasible even on a ridesharing wage. The online application is straightforward, and you may get financing the same day you submit it.
Costs
The following are the expenses of an upstart personal auto loan:
- APR ranges from 7.54 percent to 35.99 percent.
- There is no charge for the first consultation.
- There is no penalty for paying early.
- Fees not included:
A personal vehicle loan from Upstart is an excellent alternative for Lyft and Uber financing for newer and independent drivers. There are no origination costs, and rates begin at 7.54 percent, making it reasonable even if you work full-time for your ridesharing company. Daily interest on a $10,000 loan with Upstart will range from $2.05 to $9.85 each day.
Terms
The following are some of the conditions of an Upstart personal auto loan:
- Amount of loan: $1,000 to $50,000
- Term of repayment: three or five years
- Monthly repayment schedule
- Funding is available the next working day.
Upstart may help your company get a new or used car for as little as $1,000 or as much as $50,000. Although this is a lower loan than other financing alternatives, it is still inexpensive and should cover most entry-level automobiles. You may save money and own your automobile by financing your car instead of utilizing Uber car rental or Lyft Express Drive.
Qualifications
The following are some of the requirements for an Upstart personal car loan:
Unlike commercial Lyft and Uber loans, you won’t need to have been in the company for a specific amount of time or have a certain amount of yearly income to qualify for funding. A personal credit score of at least 620 is required, with customers with better credit scores being eligible for the best prices and conditions. You’ll also have to disclose your income, which most lenders use to figure out how much money you may get.
Cons
Upstart offers a low-cost, long-term personal Uber and Lyft financing alternative with fast funding. The maximum loan amount is $50,000, and to qualify, you must have a personal credit score of 620 or above. As an alternative, you could be eligible for a bigger personal loan from LightStream, which might allow you to borrow up to $100,000.
Reviews
Positive feedback about Upstart may be found all over the internet. The majority of feedback was from consumers who were pleased with how soon they received financing after completing the short application procedure. The few bad evaluations we identified were isolated instances of clients who were upset with their inability to get funding.
LightStream
Because of its low rates and extended payback periods, LightStream provides a superb personal loan that drivers may utilize to finance costly car repairs. You might be eligible for a loan of up to $100,000, repayable over a period of up to 12 years, with rates as low as 4.49 percent. You may submit your application online and have money deposited into your personal account the following working day.
Costs
The following are the charges of a LightStream personal loan:
- APR ranges from 4.49 percent to 17.49 percent (0.5 percent rate reduction if you use autopay, equaling 3.99 percent to 16.99 percent )
- There is no charge for the first consultation.
- There is no penalty for paying early.
For drivers who qualify for a personal loan, Lightstream provides an alternative to Lyft and Uber finance. LightStream’s rates are modest, ensuring that payback is manageable, and daily interest payments vary from $1.23 to $4.79 for every $10,000 borrowed. If you don’t have enough money saved up to get back on the road right soon, a personal loan is an excellent method to fund costly car repairs.
Terms
The following are the conditions of a LightStream personal loan:
- Loan amounts range from $5,000 to $100,000.
- Repayment period: two to twelve years
The minimum amount you can borrow with LightStream is $5,000, so it’s not the best choice for an oil change, but replacing a gearbox may be expensive. LightStream stands noteworthy because of its extended payback periods. Individual payments will be cheaper if you repay the loan over two to twelve years, so you won’t have to work longer hours or reject smaller fairs to make payments.
Qualifications
The following are some of the requirements for a Lightstream personal loan:
To qualify for a personal loan with LightStream, you don’t need an established company or a lot of money. This makes it available to drivers who operate a ridesharing service out of their own vehicle. To be financed, you’ll need a decent credit score of at least 660, but that’s the only criterion. The full application is likewise completed online, and monies are available the following day.
Cons
LightStream is a great personal loan with low rates and extended durations that drivers may use to fund car repairs or other one-time needs. However, it isn’t appropriate for minor Uber and Lyft financial needs, such as car maintenance and gasoline costs. A business credit card might provide more accessible funding with certain advantages for individual drivers who are structured as a company.
Reviews
LightStream reviews are mainly good. The fast and easy application procedure was praised by users. LightStream received some unfavorable feedback from customers who were denied money, although the company makes its minimal criteria known to borrowers before they apply.
How to Become a LightStream Recruiter
LightStream offers a fast and easy online application process that may get you financed the following working day. To qualify for up to $100,000 in financing at beginning rates of 4.49 percent, you’ll need a personal credit score of at least 660. LightStream is the ideal personal loan for Uber or Lyft financing since the repayment periods are long enough to make payments reasonable.
Personal Credit Card
Any Uber or Lyft driver may benefit from the freedom that personal credit cards provide. Also not only simple to qualify for, but they often give rewards for everyday expenditures like coffee and gas while you’re at work. Most drivers may borrow up to $15,000, but greater limits are conceivable, and interest rates start at 15%.
Costs
The following are the expenses of using a personal credit card:
- For up to 12 months, the introductory APR is as low as 0%.
- APR (Annual Percentage Rate): 15% to 26%
- Up to $350 each year
- Up to 3% of the transferred amount is charged as a balance transfer fee.
Another option for Lyft and Uber funding is to utilize personal credit cards for your company. These credit cards have the same rates and fees as business credit cards, but they don’t need you to be registered as a ridesharing company to be eligible. This allows you to take advantage of flexible financing for gasoline and personal expenditures while on the road.
Terms
The following are the conditions of a personal credit card:
- Credit line amount: Up to $100,000, but often up to $15,000
- Payment frequency: monthly
Despite the fact that you may be able to borrow up to $100,000, most personal credit cards have lower credit limits than other Uber and Lyft financing options. However, if you intend on paying for routine maintenance, gasoline, and personal expenditures like meals while on the road, this amount should be plenty.
Requirements
The following are the requirements for a personal credit card:
If you have a personal credit score of 620 or better, you may be able to get the best pricing and conditions. There are, however, several low-credit credit cards that may provide money to drivers with bad credit or no credit history. The amount you are accepted for is also determined by your personal income level, and as it rises, so will your overall borrowing limit.
Cons
A personal credit card is a convenient way for Lyft and Uber drivers to pay for both personal and company costs. However, since it does not provide a huge quantity of cash on its own, borrowers may raise their borrowing capacity by stacking credit cards. While there are substantial upfront costs, it is one method to use personal credit cards to access a huge quantity of money.
What is the Process for Getting a Personal Credit Card?
It just takes a few minutes to apply for a personal credit card for business, and you may obtain an acceptance decision almost immediately. You can obtain up to $100,000 in the financing, although it’s more common to get $15,000 or less. Some cards provide benefits and advantages like 0% interest for 12 months, miles, and cashback, with rates starting as low as 15%.
Crest Capital
Crest Capital provides experienced Uber and Lyft drivers with up to $500,000 in loans to buy a new or used car. There are no vehicle limitations, and you may be eligible for an APR as low as 7%. To qualify for finance, you must have been in business for at least two years and have a credit score of 650 or higher. Its online application takes 30 minutes to complete, and financing is ready the following day.
Costs
The following are the expenses of Crest Capital business vehicle financing:
- The interest rate at the start: 5%
- APR (Annual Percentage Rate): 7% to 20% (Based on comparable lenders)
- The first-month down payment and a $275 administrative charge are included in the origination price.
Crest Capital’s financing rates are among the best we found for rideshare companies looking for a car loan. Because of the low-interest rates, more money is available for operations and other investments. If you finance a $10,000 car, daily interest expenses range from $1.92 to $5.48 per day, making it cheap if you take two or more trips each day.
Terms
The following are some of the terms of Crest Capital’s business auto financing:
- Amount of the loan: $5,000 to $500,000
- Term of repayment: 24 to 72 months
- The vehicle being financed as collateral
- Personal assurance is necessary.
- The time it takes to be funded: one to three days
Crest Capital offers up to $500,000 in financing, which is far more than average automobile expenses. This might also be a realistic option for certain ridesharing companies looking to expand their fleet. Even if you qualify for more money, you won’t be able to utilize the additional cash for working capital. Crest Capital may extend a loan to cover delivery and taxes in certain cases, but you must prove those charges when applying.
Qualifications
Crest Capital’s business vehicle loan requirements include the following:
- Vehicles of any age are permitted.
- There is no limit to the number of miles you may go.
- A minimum credit score of 650 is required (check your score for free)
- Annual revenue: There is no set minimum.
- At least two years in the business
The absence of constraints on the age and mileage of the car you finance wins Crest Capital a position on our list of Lyft and Uber financing choices. Because you must have been in business for at least two years to qualify, it isn’t a good match for new rideshare drivers, but it does give a lot of flexibility, unlike other standard car finance alternatives, which only support newer and less used vehicles.
Cons
Crest Capital is an excellent option for drivers looking to finance a car for their rideshare company, with cheap rates, extended payback periods, and few vehicle limitations. It does, however, only lend to companies that have been in operation for at least two years. This puts its financing option out of reach for novice drivers, who should instead obtain a personal loan to fund their Uber and Lyft vehicles.
Reviews
Crest Capital has received mostly excellent feedback on the internet. Customers who submitted good reviews for Crest Capital praised the company’s speedy application procedure and reasonable vehicle lending conditions. Customer support was unresponsive in some evaluations, and other people were unable to qualify for finance.
How to Become a Crest Capital Client
In less than 30 minutes, rideshare companies may submit an online application for a car loan with Crest Capital. You may obtain an approval decision the same day if you fill out all of the essential information and submit all of the necessary documents. Funding up to $500,000 is usually accessible in two to five days, although it may even be the following business day.
Kabbage
For ridesharing companies that need revolving credit for regular business costs, a Kabbage business line of credit is a fantastic option. The credit line may be used to pay for repairs, maintenance, bills, gasoline, and other obligations. You might be approved for a loan of up to $250,000 in minutes over the phone, with payback periods of six, twelve, or eighteen months.
Working Capital Expenses for Kabbage Rideshare
The following are the expenses of a Kabbage business line of credit:
- Interest rates range from 1.5 percent to 10% per month (average fee is 4 percent for a six-month term and 3 percent for a 12-month term)
- Expected Annual Percentage Rate (APR): 24 percent to 99 percent
- There are no setup or maintenance expenses.
- There are no prepayment penalties or termination costs.
- There are no further charges.
Kabbage provides a significant line of credit to rideshare companies, which is often utilized as a backup source of funding for crises or to cover working capital expenditures for individual drivers and fleet operators. It has monthly interest rates, and paying it off early might save you money. Your daily interest payments will vary from $6.58 to $27.12 if you borrow $10,000 through Kabbage.
Terms
The following are the conditions of the Kabbage business line of credit:
- Amount of line of credit: $2,000 to $250,000
- Amount of the draw: $500 to $250,000
- Repayment period: six, twelve, or eighteen months (no prepayment penalties)
- Monthly repayment schedule
- Blanket UCC filing on company assets as collateral
- Personal assurance is necessary.
- Funding is available as soon as the following business day.
Each individual draw on a Kabbage working capital company line of credit has a payback period of up to 18 months. You’ll get less total cash than with other business loan choices, but since the credit line is revolving, you may utilize it again and again.
Qualifications
Qualifications for a Kabbage business line of credit include:
- A minimum credit score of 550 is required. (for free, check your score)
- At least $50,000 in yearly income (or $4,200 per month for the previous three months) is required.
- At least one year in the business
To be eligible for finance from Kabbage, you must have been in the company for at least a year and make $50,000 or more in yearly sales. It has one of the lowest personal credit score requirements of the Uber and Lyft business finance solutions we looked at, making it accessible to smaller and less qualified enterprises.
Cons
Kabbage is a wonderful working capital option that companies can use to pay for things like repairs, maintenance, and gasoline. However, it is too costly for most borrowers, and it provides no additional perks like rewards or rebates. Consider acquiring a business or personal credit card instead if you require a lesser line of credit with perks.
Reviews
Positive Kabbage reviews may be found all over the internet. Customers that gave Kabbage favorable evaluations praised the ease of use of the app and the responsiveness of the company’s customer support personnel. Users who found this Uber or Lyft financing option to be excessively costly left some poor reviews, however, Kabbage publishes its pricing on its website.
How to Submit an Application for Kabbage
In just a few minutes, you may apply for a Kabbage line of credit online from your phone or computer. The same day you submit your application, you may get an acceptance decision and a credit line of up to $250,000. You may get money the following day if you accept the offer.
Celtic Bank
SBA loans from Celtic Bank are ideal for big rideshare fleets looking to expand their fleet, build up a garage, or acquire a local competition. It has extended payback durations of up to ten years and funding levels ranging from $350,000 to $10 million, making it a cost-effective long-term financing option. The wait for financing might be up to 90 days, but the low rates of 7.75 percent to 10.25 percent make it worthwhile.
Costs
The following are the charges of an SBA loan from Celtic Bank:
- Interest rates range from 7.75 to 10.25 percent.
- Expected Annual Percentage Rate (APR): 8% to 11%
- 0.5 percent to 3.5 percent origination fee
The fees and interest rate limitations for a Celtic Bank SBA loan are determined by the Small Business Administration (SBA). These rates, combined with a government agency’s partial guarantee, make it the cheapest financing option we looked at for major working capital requirements like financing a fleet of cars or purchasing land to build a garage. For every $10,000 borrowed with Celtic Bank, the daily interest rate fluctuates between $2.12 and $2.81.
Terms
The following are the conditions of an SBA loan from Celtic Bank:
- The loan amount ranges from $350,000 to $5 million.
- Term of repayment: up to ten years
- Monthly repayment schedule
- 10% to 20% of the purchase price as a down payment
- Some security is needed (the loan does not need to be completely collateralized).
- Personal assurance is necessary.
- 30 to 90 days from start to finish
Celtic Bank is the ideal partner to finance your substantial ridesharing company growth because of its extended payback periods of up to ten years and high maximum loan sums of $5 million. However, you’ll almost always be forced to make a significant down payment, and your company will have to wait anywhere from 30 to 90 days for finance, which will entail multiple rounds of paperwork.
Qualifications
The following are some of Celtic Bank’s SBA loan requirements:
- A minimum credit score of 650 is required
- At least $100,000 in annual income
- At least two years in the business
It’s not simple to get an SBA loan from Celtic Bank. You’ll require a lot of expertise and at least two years of company operations. You’ll also need a strong credit score and a clean credit history, as well as $100,000 in yearly income. This makes qualifying as a startup or new firm challenging, therefore it’s perfect for rideshare fleets that are growing and require long-term growth financing.
Cons
For ridesharing firms, Celtic Bank SBA loans give the most money and the longest payback periods we looked at. However, it is tough to qualify for and funds might take a long time to arrive. While you wait for approval, consider a working capital line of credit from Kabbage or a more specialized financing option from Crest Capital if you simply require finance for automobiles.
Reviews
On the internet, Celtic Bank evaluations are mostly good. These evaluations are often written by borrowers and customers who have had a long and fruitful connection with the bank, and they frequently praise the bank’s wide selection of financing alternatives. Negative feedback included concerns such as not being authorized, customer service issues, and unexpected expenses.
How to Apply for Fleet Financing at Celtic Bank
Rideshare companies may begin an application with Celtic Bank online, but the majority of the procedure will take at least two weeks to complete. SBA loans are complicated and need a lot of documentation to get authorized. However, from 30 to 90 days after starting the procedure, you may acquire up to $5 million in working capital with payback terms of up to 10 years.
A business credit card is an excellent method to earn benefits for your company, such as cashback and miles, by using it to pay for everyday business costs. Many firms may borrow up to $30,000 in cash, and there are a variety of credit card choices available. Most have rates ranging from 15% to 26%, however, you may be eligible for promotional rates as low as 0% for big expenditures like repairs.
Costs
The following are the expenses of using a business credit card:
- For up to 12 months, the introductory APR is as low as 0%.
- APR (Annual Percentage Rate): 15% to 26%
- Up to $350 each year
- Up to 3% of the transferred amount is charged as a balance transfer fee.
A business credit card provides all of the advantages of a line of credit, but it’s in your wallet and typically comes with extra perks, such as cashback on purchases. Rates are a bit higher than some other financing choices, but there are no interest charges if the debt is paid off within the first 30 days, or during an introductory period. The daily interest payments for a $10,000 loan vary between $4.10 and $7.12.
Terms and Conditions
The following are the conditions of a business credit card:
- Credit line amount: Up to $100,000, however, most enterprises only need $30,000.
- Payment frequency: monthly
Although some firms may be eligible for up to $100,000, the majority of enterprises earn $30,000 or less. For most Uber and Lyft drivers, this is still a significant amount of money, and it may assist cover fuel and car maintenance bills while you earn fares to pay off the credit line. The revolving function is particularly useful for financing items on a regular basis without having to reapply each time you need credit.
Qualifications
A business credit card, unlike other types of Lyft and Uber financing for companies, does not need a minimum yearly income or time in operation. A personal credit score of at least 620 is required to qualify for the highest rates and benefits, although lower credit scores may be considered. The size of your credit line is usually determined by your yearly sales, so as your company increases, so can the amount of credit you have available.
Cons
A business credit card is a terrific method to get quick, low-cost borrowing that’s easy to apply for and qualify for. However, grant quantities seldom reach $30,000, making this a poor choice for huge projects. Consider applying for a bigger revolving business line of credit with Kabbage, which provides financing up to $250,000.
How to Apply
Business credit cards are available from major banks and credit card issuers, with simple online applications. The finest business credit card for your ridesharing company is determined by your requirements as well as the sorts of bonuses or incentives you may get. Fuel benefits or significant cashback on regular purchases are available on several excellent business credit cards for Lyft and Uber financing.
The Advantages and Disadvantages of Lyft and Uber Financing
For drivers, Lyft and Uber finance is an excellent option to hire a vehicle and get on the road immediately. It provides a low-risk choice for more drivers who have simple needs. However, it isn’t accessible in much of the United States outside of big cities, and using it as a long-term solution may be costly.
The Advantages of Lyft and Uber Financing
The following are some of the advantages of Uber and Lyft financing:
- Getting on the road quickly: You can get on the road and start earning fares the same day with an Uber or Lyft rental. It’s simple to handle since the rental includes insurance, roadside assistance, and unlimited mileage. This may be beneficial to both novice drivers who want to try new things and veteran drivers who need to replace a vehicle quickly.
- No long-term commitments: With the Lyft Express Drive program, you may borrow a vehicle for a week, and with Uber, you can rent a car for a few hours. If you simply want to work for a week or two with the firm, this is a better option than acquiring long-term finance.
- Easy to satisfy criteria: To hire a car for Uber or Lyft, there are no minimum credit score, time in business, company revenue, or personal income restrictions. Instead, you must fulfill the age restrictions and may be required to complete a certain amount of trips while renting the automobile.
Financing for Lyft and Uber has several drawbacks.
The following are some of the disadvantages of Uber and Lyft financing:
- Long-term expenditures are high: While Lyft and Uber vehicle rental programs are wonderful for short-term needs, they aren’t ideal for long-term drivers. The monthly gasoline expenditures might often approach $1,000, leaving most long-term participants with little disposable cash.
- The automobile rental programs are offered in several major US cities, but not in the majority of other locations. This implies that many drivers who wish to operate outside of those locations will have to locate a local rental solution that is authorized or utilize one of the other Lyft and Uber financing solutions we looked into.
- Lack of stability: Driving for eight hours or more each day necessitates vehicle comfort and familiarity. With a weekly rental program, you may be required to switch to a new car, which increases the risk of accidents and causes more pain for many drivers.
Frequently Asked Questions
Is it possible to get a vehicle loan via Uber?
You may finance a vehicle via Uber for a limited period. However, the scheme was phased out and replaced with automobile rentals. You may now hire a car for a few hours or a few weeks and earn fees without owning one, giving drivers greater freedom.
Can Lyft assist me in purchasing a vehicle?
Although Lyft won’t help you purchase a vehicle directly, earning money from Lyft rides may help you afford one and qualify for financing sooner. If you need a vehicle, Lyft’s Express Drive program allows you to hire one on a weekly basis. Renting, on the other hand, isn’t a good long-term option.
Is it worthwhile to hire a vehicle via Lyft?
If you want to try something new, just want to work over the holidays, or simply need a temporary substitute while your vehicle is in the shop, renting a car with Lyft is a good idea. Otherwise, if you qualify, a personal or corporate vehicle loan is a less costly choice.
Conclusion
Uber and Lyft provide a variety of finance alternatives, from authorized automobile rental programs to personal and company financing for auto loans and other expenditures. Each is beneficial for drivers in certain situations and may help them save money and get back on the road. As a rideshare company, choosing the correct Lyft or Uber finance package may have a significant impact on your bottom line.
