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In recent years, a growing number of businesses have turned to private commercial lenders instead of traditional banks to meet their financing needs. While banks have long been the go-to institutions for commercial loans, their increasingly rigid structures, prolonged approval processes, and heightened regulatory oversight have created an opening for private lenders to fill a crucial gap in the market. Private commercial loans now offer borrowers a more flexible, responsive, and customized approach to business financing—benefits that are becoming harder to find at traditional financial institutions. In this blog, we outline some of those benefits and the features in AXIS that help lenders capitalize on those benefits!

Faster Funding and Streamlined Processes

One of the most significant advantages private lenders offer is speed. Traditional banks often take weeks or even months to review loan applications, conduct due diligence, and gain internal approvals, which can be too slow for businesses that need to act quickly. Whether it’s bridging a temporary cash flow gap, capitalizing on a time-sensitive opportunity, or funding an acquisition, private lenders can typically issue term sheets within days and close loans in a week or two. This streamlined process enables borrowers to operate more nimbly and seize opportunities that might otherwise be lost waiting for bank approvals.

At the very foundation of AXIS by AIO Logic, the platform is built on intelligent automation. Two crucial results of this automation are streamlined processes and reduced operational costs. As a truly end-to-end platform, this automation is found at every stage of the loan lifecycle, including loan origination. During the loan origination process, AXIS’s AI can automate the initial screening and validation of loan applications, reducing the time and effort required for manual processing. Additionally, AXIS automates the creation of term sheets and approval memos, further reducing origination time.

Greater Flexibility in Structuring Deals

Private lenders are not bound by the same rigid underwriting guidelines and regulatory restrictions as banks, allowing them to take a more creative approach to loan structuring. While banks often rely on templated terms and conservative risk models, private lenders can customize amortization schedules, offer interest-only periods, accept unconventional collateral, and structure loans around a borrower’s unique cash flow patterns or business model. This flexibility is particularly valuable for businesses with complex financing needs or growth strategies that don’t align with traditional bank metrics.

With AXIS by AIO Logic, lenders can offer next-level flexibility to borrowers, thanks to the wide range of loan and interest rate structures that the platform can handle. In fact, AXIS has native handling for every commercial loan structure including amortizing, revolving, ABL, interest only, real estate, and many more. When it comes to interest rates, AXIS provides independent functionality for Current and PIK interest, as well as simple and compounding interest. In addition to fixed rates, AXIS allows lenders to offer variable rate structures, with the ability to choose the desired index, index calculation logic, and the margin to be added to the index rate.

Willingness to Lend in Situations Banks Avoid

Many businesses find it difficult to secure bank financing not because they lack potential, but because they don’t fit the narrow profile that banks prefer—such as having limited operating history, volatile earnings, or operating in cyclical or niche industries. Banks also tend to avoid borrowers undergoing transitions like M&A, turnarounds, or recapitalizations. Private lenders, on the other hand, are often more comfortable taking on these “story credits” and bring the experience and risk appetite needed to underwrite such situations. This makes private capital essential for borrowers who need a lender that sees beyond surface-level metrics.

When lending to borrowers that may be considered risky by bank standards, it’s important that private lenders are able to accurately assess the creditworthiness of borrowers. AXIS helps lenders achieve this by providing sophisticated out-of-the-box financial spreading and analytics functionality for both underwriting and ongoing monitoring. AXIS’s AI can analyze a wide range of data points (e.g., financial statements, transaction history, market data) to assess the creditworthiness of borrowers, providing more accurate and dynamic underwriting. This real-time analysis allows lenders to make timely and informed lending decisions.

Relationship-Oriented Approach

Borrowers working with traditional banks often feel disconnected from the decision-making process, which can be slow, opaque, and impersonal. In contrast, private lenders typically offer a more collaborative and transparent experience, where borrowers have direct access to decision-makers who take time to understand the business. This closer relationship can lead to more constructive conversations, faster responses to changing needs, and a sense of partnership that’s hard to replicate with a large financial institution. For many borrowers, this relationship-based approach is just as valuable as the capital itself.

In today’s fast-paced and complex financial landscape, relationships between lender and borrower are crucial. With AXIS by AIO Logic, lenders can establish strong relationships with borrowers in a variety of ways. Firstly, borrowers receive access to the AXIS borrower portal which serves as the primary customer-facing interface. In addition to providing account and loan related information to customers (e.g., balances and documents), all requirement tracking and document submission is performed through the portal. Secondly, the borrower portal includes collaboration features such as discussions, notes, and tasks which enable simple communication with the lender.

Less Red Tape and Fewer Ongoing Covenants

Banks are known for their heavy documentation requirements and stringent financial covenants, which can create operational headaches for borrowers. Monthly reporting, tight ratio maintenance, and the looming threat of covenant breaches can all distract from running the actual business. Private lenders tend to offer loans with lighter covenant structures and more flexible reporting standards, especially when they have confidence in the borrower’s management and business plan. This reduced administrative burden allows borrowers to focus on growth without constantly worrying about tripping a bank-imposed restriction.

For lenders who do rely on covenants, AXIS by AIO Logic provides simple yet powerful covenant monitoring functionality. In AXIS, covenant set up is quick and easy, with all covenants being parametric and centrally tracked in the Loan record. The covenant type is chosen from a list (e.g., financial statements, DSCR) and parameters (e.g., frequency, due date) are entered. Additionally, for financial covenants (e.g., EBITDA %, Fixed Charge Coverage), the testing benchmark is also added. From there, all subsequent covenant tracking and monitoring is automated.

Conclusion

Private commercial lenders have emerged as valuable partners for businesses that need fast, flexible, and personalized capital solutions. Whether a borrower is pursuing aggressive growth, navigating a transition, or simply needs financing that doesn’t fit a bank’s rigid box, private lending offers an alternative that’s often more aligned with their real-world needs. In today’s evolving financial landscape, private loans are no longer seen as a last resort—they’re increasingly the preferred choice for companies that prioritize agility, innovation, and a true lending partnership. If your firm is seeking to automate or optimize its private commercial lending operations, feel free to contact us today to schedule an intro call and learn more about all that AXIS has to offer!