Why do finance companies charge higher interest rates on loans than banks do?

They are way more likely to approve a loan request to a singular person, while banks do way more checks and are usually out of bounds for smaller businesses.

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.