5 Great Personal Loan Options For Gig Economy Workers (DoorDashers, Uber Drivers, etc.)

Rachel Curry

Rachel Curry

Published on: 17 June, 2022

Updated: 24 March, 2023

Driver in Traffic

According to Pew Research, at least 16% of Americans have used gig work to earn money. 💸 The groups most likely to do so include Hispanic adults, folks in lower income brackets, and young workers under the age of 30. Are you one of them?

Gig workers earn income through contract (“gig”-based) labor and file taxes as self-employed. Because of their alternative employment status, those in the gig economy must often work harder to receive the same personal loan options as traditional employees. Here’s how gig workers and loans tie into each other, as well as options for scoring a personal loan or business loan as a self-employed individual.

What we’ll cover:

  • How fintech loans and the gig economy go hand in hand
  • 5 types of loans for gig workers
  • What to know before borrowing money as a gig worker
  • How loans help you thrive when you need a boost

Rundown: What the gig economy includes

Delivery person on bicycle

The gig economy represents a sector of self-employed people earning income through contract or gig-based agreements, rather than the traditional employee-employer relationship. A traditional worker may receive a W-2 tax form and have taxes withheld from regular paychecks, but a gig worker may receive a 1099-MISC tax return and pays estimated quarterly taxes to the IRS based on net profit.

Examples of gig economy jobs include:

  • Ridesharing (Uber, Lyft)
  • Food delivery (GrubHub, InstaCart)
  • Contract delivery driving (FedEx, Amazon)
  • In-person freelance services (DJ, photographer)
  • App-based or digitally sourced freelance services (writer, graphic designer, virtual assistant)

FinTech, explained—and how it applies to gig workers

Gig economy workers have to work harder to prove themselves to lenders as reliable independent contractors. This can make it difficult to get a traditional loan (or one with a fair interest rate). However, the rise of fintech (financial technology) innovation has increased options for the growing population. 🧑🏽‍💻

It often takes two or more years of regular gig work income and a good credit score to prove to lenders you’re a reliable borrower. Plus, some traditional loan options don’t work for gig workers who lack standard paychecks or bank statements and have fluctuating gross income (for example, a high-interest payday loan is usually NOT wise for someone who hasn’t already secured their next check).

Regardless, a legacy financial institution, like your local bank, may be a hard nut to crack. 🥜🏦 As both fintech and gig work industries expand, we’re seeing more borrowing options appearing all the time. A few alternative borrowing options include buy-now-pay-later (BNPL) solutions for expenses, peer-to-peer loans, and social loans between friends and family.

Take Pigeon for example—we’re a social lending platform that lets you . 🐣 Whether you’re self-employed or a small business owner, Pigeon ensures a smooth, secure loan process with someone willing to help you for no cost at all.

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Five types of loans for gig workers

Friends using laptop

1. Social loan

Social loans between associated parties have plenty of advantages (including tailored loan contract terms and affordable interest rates). Social loans include personal loans from friends, family, or acquaintances who want to invest in your venture. If this option is right for you, you can easily set up and track your social loan using Pigeon's free tool here.

2. Personal line of credit 

Borrow money as needed and pay interest only on what you’ve borrowed.

3. Fixed-rate loan

The interest rate stays steady for the loan’s lifetime. (You may not want to get caught with a variable interest rate if you have fluctuating income, which is common for gig workers.)

4. Co-signed loan

For those with a lower credit score or limited income history, a joint loan may be more attainable. 🤝🏿 Having a co-signer can help reduce your interest rate and make the loan more affordable.

5. Term loan

Term loans, aka straight loans, allow a borrower to get money upfront while only paying interest on the loan for its lifetime. At the end of the loan term, the borrower may pay a balloon payment (aka large one-time payment) or refinance the loan.

What to know before borrowing money in the gig economy

Freelance professional

Experts like to tout the importance of having an emergency fund, or a sum of cash in a savings account you can access in an emergency. 

“Financial advisors tend to suggest 3–6 months of living expenses,” says Erin Lowry, author of the Broke Millennial book series. Gig workers with fluctuating income may want to err on the side of caution, saving upwards of six months of living expenses if possible.

If you can’t save that much money before taking out a loan, get as much of a cushion as you can. Borrow only what you absolutely need, to keep the monthly premium low enough that you can still save money for yourself while paying off your loan (rather than the loan payoff taking every penny from you).

Whether you choose to use a traditional bank or fintech platform to get one of these loans is up to you and the loan amount you need, but know this:

According to a study by New York University scholars, fintech lenders tend to lend more money to more people of color compared to banks. The study, Automation and Racial Disparities in Small Business Lending, used the Paycheck Protection Program during the pandemic as a case study. Fintech lenders made 26.5% of their PPP loans to Black-owned businesses, while small banks were at just 3.3%. 🤯

When selecting a loan platform, consider its legitimacy. The strides in fintech are incredible, but remember that regulation is limited for non-bank institutions, so be careful choosing your option. Look up customer reviews and news articles to make sure the platform you choose is transparent and trustworthy. You may also want to avoid high-interest loan options, like getting a cash advance from your credit card. These options tend to be much more expensive to you.

When you need a boost, loans can help you thrive in the gig economy

Loans help gig workers thrive, and here’s why.


Many independent contractors set their own rates. However, companies that base the majority of their employment model on contract labor (for example, Uber and DoorDash 🚗) determine gig worker rates. As a result, they tend to run into issues surrounding fair pay and worker treatment.

Workers at these companies are fighting to unionize while regulators are seeking to place strict limitations on what gig work employers can and cannot do. Unfortunately, legislation like California’s AB-5 placed major obstacles in the way of perfectly satisfied gig workers while seeking to protect others.

Even with rideshare gas surcharges (an extra $0.55 per Lyft ride at the time of this writing, which the customer pays to the driver) in response to soaring fuel costs and broad hyperinflation, many workers are having difficulty keeping up with a changing economy. ⛽

And even with the added freedom of gig work, you can see where the gig economy's need for capital stems from.

While bonus programs at large gig-based apps do exist, those bonuses are often only achieved after focusing a lot of time and effort on your gig. This can be difficult to achieve on a regular cadence, yet another reason why personal loans are so helpful for the gig economy.

Bottom line

The need for loans in the gig economy is clear. If you’re a gig worker and decide to pursue a personal loan, know the risks and opportunities you may face. This will help you make the best choice in which personal loan type is best for you.

Remember: Independent workers are just as valuable as those in a traditional employment setting. Let your personal loan options work for you. 💯

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About the author

About the Author

Rachel Curry


Rachel is a highly educated graduate of the University of Delaware and a professional writer with extensive experience in personal finance, corporate communications, social media, and blogging. She specializes in writing about small business finance and entrepreneurship, providing insightful advice and guidance for small business owners. Her writing for Pigeon is extremely beneficial to the community, as it has helped thousands of people make more informed decisions about their financial lives and relationships.