Financial Corporations Commercial Banks . Common Types of Bank Loans Commercial banks are a major source of funds for startup companies. However, banks are very conservative in their approach. To obtain bank funding, you need to build a relationship with a bank. It is advisable to cultivate a relationship with your local bank before you need money.
Commercial banks grant loans on either an unsecured or a secured basis.
An unsecured loan is granted on the basis of a company's credit and the strength of its financial statements. Since growing businesses in general do not have the financial track record necessary for an unsecured loan, most of the lending by a commercial bank is done on a secured basis. A secured loan requires a pledge of some or all of the assets of the company as collateral for the loan You can also expect a banker to minimize their risk by conservatively valuing your collateral and by loaning only a percentage of its appraised value. Letters of credit. Packing credit for export 1.