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Getting a Small Business Loan When the Bank Says No

By Laurie Kulikowski – July 19, 2012

NEW YORK – One of the greatest barriers in the search for business capital on Main Street is the labor-intensive underwriting process used by banks. Similar to the mortgage process, getting a business loan from a bank — if by some miracle you are approved — takes weeks or more from application submission to closing. For small businesses, the waiting game can put a crimp on operations.

Banks also place emphasis on a business owner’s personal credit history when determining whether to approve or deny the loan. One slip up on the personal credit side could cost the business funding from a bank. Nor do banks like to lend to businesses unless they have been established for several years.

On Deck Capital seeks to remove these barriers to accessing capital by using a quicker, streamlined approach for business loans that emphasizes the financial health of a business in deciding whether the business is creditworthy. It takes into account business credit data, cash flow, payments to vendors and suppliers, public record information such as liens and bankruptcies and other variables, but not a personal credit check against the owner.

Applicants are usually given a response within one day; once approved, funding can come as fast as two days.

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