Are you a small business that requires financing in less time but isn’t eligible for bank loans for small companies? Then you need an alternative lender like IOU Financial.

Welcome to our IOU Financial app review! It is a paperless lending app with a low credit score requirement, financing within a day of acknowledgement and same-day decisions.

What is The IOU Financial App?

It is a top online lending app that specializes in aiding small companies with healthy cash flow. Usual consumers involve dental and medical facilities, retail and grocery shops, hotel and restaurant chains and online businesses.

IOU Financial App

What Does IOU Financial Do?

IOU Financial offers loans to small businesses to help them with daily sales availability and working capital through partnerships. It enables fast and convenient applications with rapid funding. Same-day acknowledgement or rejection is feasible and the business gets financing within 24 hours. But ease and speed come at a premium with excessive charges and rates.

You couldn't apply directly to the platform, rather IOU Financial promotes its partners to provide their small company funding to their customers. The company has one office in Kennesaw, GA in the United States and the headquarters in Montreal, Canada.

Pros and Cons

Zero prepayment chargesHuge interest with lots of charges such as origination charges
Quick financing times within a day of approvalNeeds frequent repayment
Huge borrowing amountIt only provides short-term funding
Straight forward application procedure with same-day acknowledgementCompanies can’t directly ask for financing
Helpful website-
Low credit score requirement-

How Does It Work?

The platform supplies short-term small business loans. IOU doesn't post data on collateral needs, but its clients say it furnishes secured and unsecured loans. 

The company lets the users avail of these loan features:

  • Terms: 6 to 36 months
  • Loan amounts: 10k to 1.5 million dollars
  • Rates: undisclosed
  • Payment schedule: Daily, weekly or bi-weekly

IOU Financial Eligibility for Loans

It asks possible partners to make their small company clients meet the below requirements:

  • Yearly profits: 120,000 dollars
  • Time in business: more than 1 year

The platform hasn’t mentioned a minimum personal credit score, but previous clients say it's between 500 and 600. IOU also asks companies to have at least 8 deposits each month in their bank account.

80 percent of the ownership should agree with a personal guarantee. If a small business has 4 owners with equal stakes in the company, all of them must sign it. 

What Should You Know? 

While the platform’s target customers are companies with daily sales, it's not a trader cash advance firm. Its lending services include actual business loans with fixed payments and terms, not cash advances.

As IOU Financial primarily offer small business funding through its reseller partners, charges may vary substantially. Most of their previous or existing clients say the platform applies a fixed, simple interest. 

The clients also need to pay some substantial charges linked with loans. The company commands origination charges that range from 7 to 9 per cent of the loan amount. 

There are also guarantee charges to decrease risk and loan administration charges of 495 dollars. The company’s website has an FAQ section that bears loads of useful information. The platform supplies loans for an array of industries but its clients usually are:

  • E-commerce merchants
  • Grocery shops
  • Retail shops
  • Dental and medical facilities
  • Hotel chains 
  • Restaurants

Relevant: 8 Best and Instant Loan Apps In UAE 2024

How Can I Apply to IOU Financial?

Clients couldn’t apply directly to IOU as the platform markets to trusted resellers to provide its small business funding to its clients. Users can fill out the referral form on the company’s website as it goes to their lender partners. The platform doesn't supply loan applications but it may suggest other lenders.

For ISOs and Loan Brokers:

IOU’s advertised referral partner program functions in these steps:

  • Give mature leads to the platform
  • Directly help your customer to get the loan approved
  • Gets a closing call for them
  • Earn commission after closing the deal

The company utilizes a proprietary platform to assess customers’ financial information quickly, especially concentrating on regular cash flow.

It employs this process to accelerate underwriting, which enables same-day approvals and fast loans. As a partner’s customers receive approval, the platform utilizes a wire transfer to send their funding to them, which may occur within a day.

IOU, Post Funding

Repayment starts after a borrower gets their loan. The payment processing happens through an ACH transfer from the small business’s bank account. Borrowers can pay daily, weekly or biweekly, but not monthly.

Origination charges are included in their gross loan amount when the money is disbursed, and they will pay the charges as part of their fixed repayment schedule. The borrower doesn’t need to pay any prepayment charges to pay the amount off before the term ends, but loan defaults and late payments hold huge penalties.

What are the Upsides of IOU Financial?

It furnishes quick business funding with decreased credit score requirements than a credit union or bank. The application is convenient and fast, and you receive a determination in 2 hours. Funds are high at 1.5 million dollars. IOU Financial has an informative site and remarkable online credibility.

What are the Downsides of IOU Financial?

The company charges high interest rates and append multiple charges which makes it pricey to borrow money. The lender only gives short-term loans and needs frequent repayments, which may strain cash flow. Small companies couldn’t apply directly to the lender for loans. It needs to work with a partner reseller of IOU.


IOU Financial is a suitable lender for thriving small businesses with consistent monthly deposits and daily sales. The platform provides bigger funding, fast approvals and quick funding times but the cons are extra charges and higher interest rates. The necessity of working with an IOU partner to apply for funding is also a bummer for many companies. Businesses that like to work directly with a lending marketplace or lender should find one that provides direct applications such as UCS.