What advantages do finance companies have over commercial banks?
Besides, what is the advantage of dealing with a commercial finance company?
Advantages of a commercial finance company are: less conservative than a traditional bank in making small business loans; willing to make riskier loans (Commercial finance companies are subject to less regulation and can assume more risk.)
In this way, how do finance companies differ from commercial banks?
Finance companies differ from commercial banks in the following: Banks offer deposits services but finance companies do not finance companies only offer loans to businesses through finance companies can offer some bank services such as retirement planning, home loans among others.
Commercial financing institutions generally charge higher interest rates than banks and credit unions, but they are also more likely to approve a loan request. "For that reason, they can loan more against the assets. So chances are a smaller business might get a larger loan from a finance company" than from a bank.