6 best small personal loans of 2023

A man opens mail in his home office, hoping to hear back about a small personal loan.Image: A man opens mail in his home office, hoping to hear back about a small personal loan.

In a Nutshell

Small personal loans can provide extra cash to pay for expenses when you’re in a pinch and don’t need a large sum of money. But interest rates, loan terms and fees can vary between lenders, so do your research before applying for this type of loan. We’ve rounded up our top picks of the best small personal loans with features such as competitive rates, flexible repayment terms, minimal fees and the ability to prequalify.
Editorial Note: Intuit Credit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors’ opinions. Our third-party advertisers don’t review, approve or endorse our editorial content. Information about financial products not offered on Credit Karma is collected independently. Our content is accurate to the best of our knowledge when posted.

Personal loans aren’t just for large purchases. Small personal loans can help you pay for unplanned expenses without borrowing more money than you need.

When we say small personal loans, we’re generally referring to loans in amounts of $3,000 or less. Some lenders have minimum loan requirements that exceed this threshold, but for this list we’ll consider lenders that offer loans in amounts that start at a few hundred to a few thousand dollars.

We’ve rounded up our list of the best small personal loans to help you find one that might be right for you.

Best for building credit: Possible Finance

Why Possible Finance stands out: Possible Finance is a payday loan alternative app that allows customers to apply for extra cash using the Possible app on their phone. Unlike payday lenders, Possible Finance reports loan payments to two of the three main credit bureaus to help customers build credit.

  • Repayment terms — Loans are repaid in installments over two months. If you’re unable to make a payment, you can reschedule it for up to 29 days after your original due date without penalty.
  • Loan amounts — Customers may be able to borrow up to $800, but maximum loan amounts vary by state.
  • Eligibility requirements — To qualify for a loan through the Possible Finance app, you need a valid driver’s license or state-issued ID. You must have a positive bank balance and proof of income in the linked bank account.
  • Ability to apply for prequalification — Possible Finance uses a soft credit inquiry that allows you to check your estimated rate without affecting your credit scores. Although getting prequalified doesn’t mean you’re approved for a loan, it helps you to understand whether you’re likely to be approved and the loan terms you may qualify for.

Before applying with Possible Finance, note that the lender doesn’t include interest rates on its site — instead, the site lists fees that represent the cost of borrowing in each state. Possible Finance doesn’t offer loans in all states. Check with the lender before you apply. 

Read our review of Possible Finance to learn more.

Best for people who are self-employed: Upgrade

Why Upgrade stands out: Getting a personal loan when you’re self-employed is possible, but you need to be able to show the lender you can repay what you borrow. To apply for a personal loan with Upgrade, you may need to provide your two most recent years of tax returns. Upgrade may request additional documentation after reviewing your application.

  • Loan details — Upgrade offers loan amounts ranging from $1,000 to $50,000 with term lengths of 24 months to 84 months.
  • Fees — Upgrade charges an origination fee of 1.85% to 9.99%, which is deducted from your loan proceeds at the time of funding. The company charges nonsufficient funds fees and late payment fees of up to $10, but there’s no prepayment penalty if you want to repay your loan early.
  • Interest rates — Upgrade’s starting annual percentage rate, or APR, is in line with what other personal loan lenders charge. To qualify for the company’s lowest rates, you must sign up for autopay.
  • Ability to prequalify — You can check your estimated rate and loan term before submitting a formal application — without affecting your credit scores. Keep in mind that if you apply and are approved, your rate and term may differ from what you saw during prequalification. 

Read reviews of Upgrade to learn more.

Best bank personal loan: PNC

Why PNC stands out: PNC offers loan amounts as low as $1,000 with competitive annual percentage rates and flexible repayment terms. You can receive a 0.25% rate discount when you sign up for autopay with a PNC checking account.

  • Loan details — PNC offers personal loans starting at $1,000 and repayment terms of six to 60 months.
  • No collateral required — PNC doesn’t require collateral to approve your loan.

Read our review of PNC to learn more.

Best for multiple offers: Fiona

Why Fiona stands out: Fiona is not a personal loan lender, but it is an online search and comparison site for personal loans, credit cards and other financial services. When you submit a loan application, you’ll receive personalized loan offers from lenders in Fiona’s network, if you qualify. You can select the one — if any — that’s right for you.

  • Loan details — Fiona’s network includes lenders that offer loan amounts ranging from $1,000 to $250,000 and repayment terms of six to 144 months.
  • Fees — Fiona doesn’t charge fees for its service, but some of the lenders in Fiona’s network might. Be sure to read the fine print of all loan offers you receive to ensure you understand what fees you may be responsible for.
  • Ability to apply for prequalification — Checking to see if you qualify for a loan offer won’t affect your credit scores. Note that prequalification isn’t a guarantee of approval, and you may be offered different terms after completing a full application. 

Read our review of Fiona loans to learn more.

Best online personal loan: Discover

Why Discover stands out: Discover’s application process can be completed entirely online. You’ll get a loan decision the same day you apply, in most cases, and you’ll receive your loan proceeds as soon as the next business day after accepting the loan terms. Loans from Discover come with access to view your FICO® score for free.

  • Loan details — Discover offers loans ranging from $2,500 to $40,000 with repayment terms of 36 to 84 months.
  • Fees — Discover doesn’t charge origination or prepayment fees, but you may have to pay a late fee if you miss a payment.
  • Ability to prequalify — Checking your estimated rate and loan term won’t affect your credit scores. If you submit a formal loan application and are approved, your rate and term may be different from what you saw during the prequalification process.
  • Direct debt payments — If you plan to use your loan funds to pay off debt, you can choose to have Discover pay your creditors directly.

Read our full review of Discover personal loans.

Best for immigrants: Stilt

Why Stilt stands out: Stilt is a mobile app that specializes in providing loans to immigrants and underserved communities. You don’t need a Social Security number or credit history to apply for a loan through Stilt. Stilt reports monthly payments to Experian and TransUnion, which can help users establish a solid credit history in the U.S.

  • Loan details — Stilt offers loans ranging from $1,000 to $35,000 with repayment terms of 12 to 36 months. Minimum loan amounts are higher in certain states.
  • Eligibility requirements — You must have a U.S. address, bank account and valid visa for at least six months to qualify for a loan with Stilt. Stilt reviews applicants’ employment history, education and financial habits to make lending decisions.
  • Ability to prequalify — Stilt’s prequalification process uses a soft credit pull that allows applicants to check their estimated rate and loan term without affecting their credit scores. Remember that if you apply and are approved, your rate and term may differ from what you saw during prequalification.

Stilt doesn’t offer loans in all states. Check with the lender before you apply. 

Read our full review of Stilt loans.

What you should know about small personal loans

It’s not always possible to save up for emergencies, and not every emergency requires a large sum of cash to fix. A small personal loan could be a good way to get extra cash when you need it. But there are some things you should know before you start shopping for a loan.

How do small personal loans work?

Minimum loan amounts are set by individual lenders, so the smallest loan you can get from some lenders may be more than you need. But there are lenders that offer small personal loans, including loans of $1,000 or less. Because loan amounts, rates, terms and fees vary by lender, it’s best to shop around and compare offers from multiple lenders to find one that’s a good fit.

How do I apply for a small personal loan?

Small personal loans are available from different types of lenders, including banks, credit unions, online lenders and mobile apps. To apply, you need to complete an application and provide any supporting documentation the lender requires. Lenders typically review your credit history, income, debt-to-income ratio and other factors to make a lending decision.

Are there other types of small loans?

A small personal loan isn’t the only way to get extra cash. Here are some other options to consider.

  • Payday loans — Payday loans are an option for covering small unplanned expenses, but they’ll likely cost you more than a non-payday type personal loan. The average APR for a payday loan is close to 400%. A payday loan’s high fees and short repayment terms often keep people trapped in a cycle of debt that’s difficult to break. Many people who take out a payday loan renew it so many times they owe more in fees than what they originally borrowed.
  • Credit cards — Credit cards are a convenient option to pay for unplanned expenses. But the average credit card interest rate is higher than the average personal loan rate. Comparing the APR on your card to the personal loan rate you might qualify for might help you decide which option is better. You may also consider applying for a card that has a 0% intro APR for purchases. If you can pay off the balance before the promotional period expires, you won’t pay interest. But if you don’t pay off the balance before the promotional period ends, the remaining amount will accrue interest at the card’s regular rate.
  • Payday alternative loans — Payday alternative loans are small-dollar, short-term loans available at some federal credit unions. Loan amounts range from $200 to $1,000 with terms of one to six months. Some PALs may have a $20 application fee, but interest rates are capped at 28%.
  • Buy-now, pay-later apps. Buy-now, pay-later apps such as Klarna, Afterpay and Bread allow you to make a purchase now and pay for it in installments without taking out a loan. With many buy-now, pay-later apps, you won’t pay interest on your purchases, but repayment timelines are often shorter than a traditional personal loan. Some options may have high interest rates, late fees and other costs, so you’ll need to read the fine print to decide if using one is a good choice. Unless the item you’re buying is a “need-to-have,” it’s probably better for your financial health to postpone your purchase until you have the cash to pay for it.

Taking on more debt should be a last-ditch option, even if you only need to borrow a small amount. Consider alternatives like saving a little bit each month or taking on a side job until you can earn what you need. If it’s an expense that can’t wait, consider selling something to get the cash you need.

How we picked these loans

We reviewed a dozen small personal loans from a variety of lenders and chose our top picks based on eligibility requirements, the ability to build credit, interest rates, fee structure and the ability to apply for prequalification.

About the author: Jennifer Brozic is a freelance financial services writer with a bachelor’s degree in journalism from the University of Maryland and a master’s degree in communication management from Towson University. She’s committed… Read more.