Traditional bank loans require certain lending criteria that are more stringent than for a cash flow loan. These include checking the potential borrower’s profit and loss, and cash flow statements. A new business might be required to provide a business plan as well. In many cases, a bank business loan will require some form of collateral, including residential or commercial property. The process for getting a traditional bank loan can take from weeks to several months. The long timeframe makes this type of business loan unsuitable when the funds are needed quickly.

With cash flow lending, the lender uses different lending criteria. This can include checking recent bank statements to determine if the borrower will be able to make the payments. Online cash flow lenders use leading-edge technology to determine the creditworthiness of a potential borrower. So there’s no requirement to submit large amounts of paperwork such as a business plan and financial statements.

Unlike with banks, this background research is conducted quickly – most cash flow lenders can make a decision on granting a loan within 24 hours and transfer funds immediately upon loan approval. Given the quick timeframe for getting a cash flow loan, it’s preferable when money is needed in a hurry. Another attribute of these loans is that they unsecured, meaning they don’t require collateral.