Guide

What do underwriters actually look for in your bank statements?

Seven things, roughly in order: whether deposits are operating revenue or transfers; how many deposits arrive and how evenly; the average daily balance and how many days it ran low or negative; returned items; existing daily or weekly debits from other funders; the trend across the months; and whether the most recent month looks like the rest. The statements are the whole application at most revenue-based funders. Read yours the way they will before you send them.

The seven checks

Real revenue versus everything else. Transfers from savings, loan proceeds, owner injections and refunds are stripped out. What is left is what the offer is sized on.

Deposit count and rhythm. Twenty card settlements a month reads as a business; two large wires reads as a business dependent on two customers, and it is priced that way.

Average daily balance and low days. A common rule wants the average balance at ten to fifteen times the daily payment about to be set. Days near or below zero are counted individually.

Returned items. More than about three in ninety days drops the file a grade.

Existing positions. Daily and weekly ACH debits to other funders are identified by name. They reduce capacity and, past a point, end the application.

Trend. Rising, flat or falling across the months. A falling trend is the hardest thing to explain away.

The last month. Weighted most, and compared to the rest. A strong year ending in a weak month is questioned; a weak year ending in a strong month is discounted.

What each underwriter weighs

A BANKA REVENUE-BASED FUNDERPERSONAL CREDIT SCOREheavysomeCOLLATERAL TO PLEDGEheavynot looked atTWO YEARS OF TAX RETURNSheavynot looked atTIME IN BUSINESSheavysomeMONTHLY BANK DEPOSITSsomeheavyDEPOSIT CONSISTENCYnot looked atheavyINDUSTRY AND STATEsomeheavy
The same business, read two different ways. A bank decision is built on credit, collateral and filed accounts; a revenue-based funder builds it on the money moving through your account. That is the whole reason a bank decline says very little about whether you can be funded.

What to send, and how

Complete PDF statements from the bank, every page, three to six months minimum and twelve if the business is seasonal or the recent months are weak. Screenshots, spreadsheets and partial months slow the file or stop it. Many funders now read statements through a direct bank connection, which pulls the same data faster; if you are asked to connect, it is the same review, not a deeper one.

A cover note of three or four lines helps more than people expect: what the business does, what the money is for, and one sentence on anything in the statements that needs a reason — a large transfer, a dip with a cause, a customer's bounced check.

What you can fix in ninety days

Almost everything except the trend. Deposit all cash. Keep a cushion so no day runs low. Stop the debit that keeps bouncing. Move personal spending off the business account. Route card sales into the account the statements come from. Three clean months, with the most recent the cleanest, is a different application from the same business.

Sources

Related questions.

Do underwriters look at my personal bank account?
Rarely, unless the business runs through it — a sole proprietor with no business account is underwritten on the personal statements, and the personal spending in them is read too.
Does a high balance help if deposits are low?
It helps the payment look safe and it does not change the size of the offer, which follows deposits. A large balance with thin deposits reads as savings, not revenue.
Will they call my bank?
Some verify balances through a bank connection or a short verification call before funding. It is confirmation, not a new review, and it is why the statements you send need to match the account exactly.

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