#6 Best Banks for Small Business For Funding Tier 1 vs Tier 2 Credit, Even If Limited!

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- Transform Your Business in 11 Days: Credit & Funding Exclusive Video Series
Best Banks for Small Business For Funding - Tier 1 vs Tier 2 Credit, Even If Limited!

1. **Choosing the Right Bank for Funding**:
- The video highlights that many small business owners struggle to get sufficient funding because they may be using the wrong bank. The type of bank you choose significantly impacts the amount and ease of obtaining business funding.

2. **Four Tiers of Financial Institutions**:
- **Tier 1 (Major Banks)**: These include banks like Chase, Bank of America (BofA), Citi, and Capital One. They are large institutions where you might start by opening a business account for deposits. However, these banks typically require higher revenue levels for significant funding and may only offer smaller amounts if your business lacks substantial revenue.
- **Tier 2 (Community Banks)**: Examples include Regions, Truist, and PNC. These banks are more willing to provide funding even if your business doesn’t have high revenue. They usually offer starting amounts of $10,000 or more and are more flexible with credit requirements.
- **Tier 3 (Credit Unions)**: Institutions like Navy Federal and Connexus fall into this category. They focus on the relationship with the business rather than its revenue. Although credit unions might offer substantial funding (e.g., $25,000 from Navy Federal), they typically don’t report to business credit bureaus, which can impact your business credit building.
- **Tier 4 (Revenue-Focused Institutions)**: This tier includes financial services like BlueVine and Capital on Tap, which prioritize the business’s revenue over credit scores. These are ideal for businesses with strong revenue streams but possibly lower credit scores.

9. **Navy Federal’s Dual Scoring System**:
- Navy Federal uses two scoring systems to evaluate business funding applications: an internal score ranging from 100 to 450 and Experian’s FICO 9. While they may offer significant funding, the lack of reporting to business credit bureaus can be a drawback for those looking to build their business credit profile.