{"id":3808,"date":"2018-12-20T16:06:50","date_gmt":"2018-12-20T14:06:50","guid":{"rendered":"https:\/\/www.lending-express.com\/blog\/?p=3808"},"modified":"2021-08-25T16:48:54","modified_gmt":"2021-08-25T13:48:54","slug":"why-does-my-lender-want-to-see-my-bank-account-activity","status":"publish","type":"post","link":"https:\/\/www.become.co\/blog\/why-does-my-lender-want-to-see-my-bank-account-activity\/","title":{"rendered":"Why Does My Lender Want to See My Bank Account Activity? [5 Reasons]"},"content":{"rendered":"\n\n

Whether you apply for business funding from your local bank, an online lender or through <\/span>Become<\/span><\/a>, it all comes down to the same thing – they\u2019ll want to see your business bank account activity.<\/span><\/p>\n\n

Typically that includes your bank statements and transaction history for at least the last few months. <\/span><\/p>\n\n

But why is it necessary?<\/p>\n\n

Keep reading to learn the reasons why lenders want to see your bank account activity and how Become simplifies this step in the business lending process so you can get approved quickly and with no stress<\/em><\/strong>.<\/p>\n\n

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Side note: <\/strong>A bank or traditional lender will generally ask for a whole lot more paperwork and financial information, so bear that in mind when you apply for a loan from an online lender – you\u2019re getting off easy!<\/span><\/p>\n<\/blockquote>\n\n

Why do lenders need to see bank statements?<\/b><\/h2>\n\n

So what do lenders look for on bank statements?<\/span><\/p>\n\n

How does this help them assess your business?<\/span><\/p>\n\n

We tell you why they need your bank statements below.<\/p>\n\n

Top reasons why lenders check your bank statements:<\/strong><\/p>\n

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  1. Verify your business’s name<\/li>\n
  2. Financial history<\/li>\n
  3. Average daily balance<\/li>\n
  4. Daily deposits<\/li>\n
  5. Recurring payment<\/li>\n<\/ol>\n\n

    Verify your business\u2019s name<\/b><\/h3>\n\n

    Lenders want to make sure that you are who you say you are, and what better way to do this than your bank statements? They use the information provided on your statements to verify your business\u2019s registered name and trading name.<\/span><\/p>\n\n

    Financial history<\/b><\/h3>\n\n

    Your bank account activity over the past few months can give a good indication of your business health. Lenders usually ask for at least 3 months\u2019 worth of bank statements.<\/span><\/p>\n\n

    Average daily balance<\/b><\/h3>\n\n

    If your average daily balance remains more or less constant and is positive over a period of time, you are likely to get funding for your business.<\/span><\/p>\n\n

    Daily deposits<\/b><\/h3>\n\n

    Obviously, the more daily deposits you have, the better, as lenders can see that you\u2019re bringing in revenue. They get this information from your bank statements.<\/span><\/p>\n\n

    Recurring payments<\/b><\/h3>\n\n

    Your bank statements prove to your lender that your deposits or revenue are more than your payments or expenses. Another tell-tale sign of a low-risk borrower.<\/span><\/p>\n\n

    Can I get a loan without showing my bank account activity?<\/h2>\n\n

    Since your bank account mirrors your financial health, it is pretty much impossible to find a business lender that does not require some indication of your financial stability. A loan without bank statement does not exist (but business loans without credit checks<\/a> do)! It\u2019s like a sandwich without bread, or a leopard without spots. <\/span><\/p>\n\n

    You get the picture.<\/span><\/p>\n\n

    The closest thing you could get to a no doc business loan is a Merchant Cash Advance, but these lenders generally also ask you to link to your bank statements or credit card statements. So what exists, really, are low doc business loans, with bank statements being \u2018low doc\u2019 requirements.<\/span><\/p>\n\n

    Other low doc <\/span>business loans<\/span><\/a> include unsecured business loans, lines of credit, invoice financing and equipment\/vehicle finance.<\/span><\/p>\n\n

    So do lenders check bank statements? Yes, they do.<\/strong><\/p>\n\n

    And do lenders verify bank statements? Affirmative on this one too.<\/strong><\/p>\n\n

    Which is part of the reason why banks take so long to assess loan applications – not only do they need to collect the documents, but then they still have to verify them. <\/span><\/p>\n\n

    Which brings us to…<\/span><\/p>\n\n

    A faster alternative to uploading bank statements<\/b><\/h2>\n\n

    By now you\u2019ve realized there\u2019s no getting around providing your bank account activity , so you might as well make it as simple for yourself as possible.<\/span><\/p>\n\n

    Instead of logging into your online banking, downloading your bank statements and uploading them to your loan application (sounds like a waste of time, right?), you can get this all done in one quick step. <\/span><\/p>\n\n

    In this digital age there\u2019s a solution for all you time-deprived business owners. <\/span><\/p>\n\n

    Instead of providing your bank statements the old fashioned way, when you apply for a business loan through Become<\/a>\u00a0you can now simply link your bank account to your loan application and you’ll unlock optimal funding options from the top lenders. This gives you better results, in a fraction of the time.\u00a0 Read on to learn more about the benefits of linking your bank account.\u00a0<\/span><\/p>\n\n

    There\u2019s also the added benefit of saving the lender from having to verify your bank statements, which means an even quicker approval for you.<\/span><\/p>\n\n

    At Become, we use Plaid<\/strong>, one of the leading and most secure services available, to enable our customers to link their bank accounts to their loan applications. You don\u2019t need to know the technicalities behind how Plaid works (unless you happen to be a techno-geek, in which case let us know and one of our techno-geeks will fill you in). <\/span><\/p>\n\n

    What will interest you though is that <\/span>one in four Americans with a bank account now uses Plaid. <\/b>In a country where 93.5% of people have bank accounts \u00a0(based on 2017 data), this means that 81.4 million people in the US use Plaid<\/strong>. <\/span><\/p>\n\n

    Plaid works with top companies including Citi, American Express, Venmo and more. The company is rock-solid and growing and, according to Forbes, <\/span>Plaid is now valued at $2.65 billion<\/span><\/a>.<\/span><\/p>\n\n

    Enough said.<\/span><\/p>\n\n

    Is it safe to link your bank account?<\/b><\/h2>\n\n

    Yes, it is completely safe to link your bank account to your Become application. <\/span><\/p>\n\n

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      • Your data is encrypted by the best technology, guaranteeing complete privacy and protection. <\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n
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          • Linking your bank account gives view-only access to your bank account.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n
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              • We only view information that you would share anyway, such as your bank statements and transaction history.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n
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                  • We don\u2019t store your bank login data.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n

                    How to link your bank account to your loan application<\/b><\/h2>\n\n

                    When you apply for a business loan through Become, you can link your bank account to your loan application in one quick step.<\/span><\/p>\n\n

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