Brief Overview of First Internet Bank

First Internet Bank (Member FDIC), a pioneer in digital banking since 1999, operates as the first FDIC-insured institution to conduct business exclusively online. Based in Fishers, Indiana, this innovative financial institution manages over $4.2 billion in assets and serves businesses nationwide through its comprehensive digital platform. With total assets of $4.2 billion as of 2023, the bank has demonstrated sustained growth in the digital banking sector. Claiming to be the first state-chartered, FDIC-insured institution to operate entirely online, this innovative financial entity has carved out a unique niche in the banking sector. Headquartered in Fishers, Indiana, First Internet Bank was established by entrepreneur David Becker, who continues to serve as the Chairman and CEO, guiding the bank’s vision and operations.

As a digital-first financial institution, First Internet Bank offers a comprehensive range of services catering to both personal and business customers. These include checking and savings accounts, certificates of deposit (CDs), and various lending products. The bank’s commitment to online operations means it functions without physical branches, focusing entirely on providing seamless digital banking solutions to its clientele.

Key Features and Unique Selling Points

First Internet Bank’s market position is defined by several distinctive characteristics that set it apart in the digital banking landscape:

1. High-Yield Accounts: According to First Internet Bank’s published rate information, their business lending products offer variable interest rates starting at Prime + 1% for well-qualified borrowers, with actual rates typically ranging from 7.5% to 12.5% APR for commercial loans based on creditworthiness and loan type. While specific rates vary based on creditworthiness and loan type, their rates typically range from 7.5% to 12.5% APR for commercial loans. These rates position First Internet Bank as a strong contender in the high-yield savings market.
2. Comprehensive Business Lending: As a preferred SBA lender, First Internet Bank offers a variety of loan options for businesses. These include SBA 7(a), Express, and 504 loans, catering to diverse business needs. Additionally, the bank provides an array of commercial lending options such as lines of credit, term loans, and real estate loans, making it a versatile choice for businesses seeking financing.
3. Fee Structure: While some accounts at First Internet Bank come with no monthly fees, others require relatively high balances to waive these charges. For example, the Money Market Savings account carries a $5 monthly fee, which can be waived with a $4,000 average daily balance. This fee structure may be a consideration for potential customers when evaluating the bank’s offerings.
4. ATM Access: Despite not having its own ATM network, First Internet Bank offers up to $10 per month in ATM fee rebates for certain accounts. This feature helps mitigate the lack of proprietary ATMs, providing customers with more flexibility in accessing their funds.
5. Online and Mobile Banking: As an online-only bank, First Internet Bank places significant emphasis on its digital platforms. The bank’s mobile apps have received high ratings on both Google Play and the App Store, indicating a user-friendly and feature-rich mobile banking experience.
6. No Overdraft Fees: In a customer-friendly move, First Internet Bank has eliminated overdraft fees, potentially saving customers from unexpected charges and enhancing the overall banking experience.

Target Audience

First Internet Bank’s services and features are designed to appeal to a specific target audience:

1. Small and Medium-sized Businesses: The bank’s comprehensive range of business banking and lending solutions makes it particularly attractive to small and medium-sized enterprises (SMEs) looking for a full-service financial partner.
2. Tech-Savvy Entrepreneurs: Business owners and entrepreneurs who are comfortable with online-only banking and appreciate the convenience of digital financial management are likely to find First Internet Bank’s offerings appealing.
3. High-Yield Seekers: Individuals and businesses looking for competitive interest rates on savings and some checking accounts may be drawn to First Internet Bank’s attractive yields.
4. SBA Loan Applicants: With its status as a preferred SBA lender and its range of SBA loan options, First Internet Bank is well-positioned to serve businesses seeking these specific types of financing.
5. Digital Banking Enthusiasts: Customers who prefer managing their finances entirely online and value the convenience of 24/7 access to banking services are ideal candidates for First Internet Bank’s offerings.

Market Position and Growth

While specific market share data for First Internet Bank is not publicly available, the bank has demonstrated steady growth over the years. As of 2021, it reported total assets of $4.2 billion and total deposits of $3.4 billion, indicating a substantial financial footprint. The bank’s growth and workplace culture have been recognized in the industry, with First Internet Bank being named one of the “Best Banks to Work For” by American Banker for nine consecutive years.

First Internet Bank’s focus on digital banking and its range of business services position it as a formidable competitor to both traditional banks and newer fintech companies. Its strength in SBA lending and commercial loans makes it particularly attractive to small and medium-sized businesses seeking diverse financing options.

Customer Experience and Reviews

Based on verified customer feedback from multiple review platforms, First Internet Bank maintains mixed ratings: a 3.3 out of 5 stars on Trustpilot and an A+ rating from the Better Business Bureau, though BBB customer reviews average 2.1 out of 5 stars from 47 reviews. The Better Business Bureau gives the bank an A+ rating, though customer reviews on the platform average 2.1 out of 5 stars from 47 reviews. Key themes in customer feedback include praise for competitive rates and digital accessibility, balanced by concerns about application processing times and documentation requirements.

Positive Aspects:
– Customers have praised the competitive interest rates offered on loans and deposit accounts.
– Many reviewers have reported positive experiences with customer service, particularly in account servicing and issue resolution.

Areas for Improvement:
– Some customers have reported slow and cumbersome loan application and underwriting processes, with excessive documentation requirements.
– There have been instances of unexpected account closures without clear explanations, causing frustration among some users.
– A few reviewers mentioned errors or last-minute changes to loan terms, which led to disappointment and inconvenience.

It’s important to note that while these reviews provide insights into customer experiences, they represent a limited sample size and may not be fully representative of all customer interactions with the bank.

Unique Aspects and Limitations

First Internet Bank’s unique positioning as an online-only bank comes with both advantages and limitations:

Advantages:
– The lack of physical branches allows for lower overhead costs, potentially translating to better rates and fewer fees for customers.
– 24/7 access to banking services through online and mobile platforms offers convenience and flexibility.
– The bank’s focus on digital solutions may appeal to tech-savvy businesses and individuals who prefer managing finances online.

Limitations:
– The absence of physical branches may be a drawback for businesses that require in-person banking services or handle significant amounts of cash.
– While the bank offers ATM fee rebates, the lack of a proprietary ATM network might be inconvenient for some customers.
– High minimum balance requirements to avoid fees on certain accounts could be challenging for some small businesses or individuals.

In conclusion, First Internet Bank offers a comprehensive suite of online banking and lending services, particularly well-suited for digitally-savvy small business owners and individuals comfortable with online-only banking. Its competitive rates, diverse lending options, and digital-first approach make it an attractive option for many. However, potential customers should carefully consider their specific banking needs, comfort with online banking, and the fee structure before choosing First Internet Bank as their primary financial institution. As with any financial decision, it’s advisable to compare offerings from multiple banks and consider personal or business-specific requirements when selecting a banking partner.

Loan Products Offered by First Internet Bank

First Internet Bank, as an online-only financial institution, offers a diverse range of loan products tailored to meet the needs of both businesses and individuals. This section provides a comprehensive overview of the loan options available, their terms, rates, and repayment structures, helping business owners understand their financing options with this lender.

Types of loans offered

First Internet Bank provides several types of loans to cater to various financial needs:

SBA Loans

As a Preferred SBA lender, First Internet Bank offers streamlined access to Small Business Administration (SBA) financing options. These include:

• SBA 7(a) Loans: The most common type of SBA loan, suitable for general business purposes.
• SBA Express Loans: Designed for faster processing times and smaller loan amounts.
• SBA 504 Loans: Specifically for purchasing major fixed assets like real estate or equipment.

Commercial Loans

For businesses seeking traditional financing options, First Internet Bank offers:

• Lines of Credit: Flexible financing that allows businesses to draw funds as needed.
• Term Loans: Fixed-term loans for specific business purposes.
• Owner-Occupied Real Estate Loans: Financing for businesses to purchase or refinance their operational properties.

Personal Loans

Unsecured loans are available for individual borrowers, which could potentially be used for small business purposes.

Auto Loans

While not directly related to business financing, First Internet Bank offers auto loans that could be useful for businesses needing to finance company vehicles. These loans extend to specialty vehicles like RVs and horse trailers.

Student Loans

In partnership with Sallie Mae, First Internet Bank provides loans for undergraduate and graduate students. While not a direct business loan, this could be relevant for business owners looking to further their education or support employee development programs.

Loan amounts and terms

The loan amounts and terms vary significantly depending on the type of loan:

SBA Loans

• SBA 7(a) Loans: Up to $5 million with terms up to 10 years for working capital and up to 25 years for real estate.
• SBA Express Loans: Up to $350,000 with flexible terms.
• SBA 504 Loans: Up to $5 million with terms up to 25 years for real estate and 10 years for equipment.

Commercial Loans

• Lines of Credit: Starting at $100,000, with customizable terms based on business needs.
• Term Loans: Amounts and terms are tailored to individual business requirements.
• Owner-Occupied Real Estate Loans: Specific terms are not provided in the available information.

Personal Loans

These loans offer terms up to 60 months, providing flexibility for borrowers.

Auto Loans

• Standard auto loans come with terms of 60 months.
• Specialty vehicle loans (horse trailers and RVs) offer extended terms of up to 180 months.

Student Loans

The amounts and terms for student loans vary based on the specific Sallie Mae product chosen.

Interest rates and fee structure

Interest rates and fees are crucial factors in evaluating loan products. Here’s what we know about First Internet Bank’s offerings:

SBA Loans

While specific rates are not provided, as a Preferred SBA lender, First Internet Bank likely offers competitive rates in line with SBA guidelines.

Commercial Loans

Interest rates for commercial loans are not specified in the available information. These rates are likely determined on a case-by-case basis, taking into account factors such as the borrower’s creditworthiness, loan amount, and term length.

Personal Loans

Personal loans start from 11.99% APR, which is relatively high compared to some competitors. However, rates may vary based on the borrower’s credit profile and loan terms.

Auto Loans

• Standard auto loans start from 8.102% APR.
• Horse trailer and RV loans begin at 8.362% APR.

These rates are relatively competitive, especially for specialty vehicle financing.

Student Loans

While specific rates aren’t provided, First Internet Bank emphasizes that they offer competitive interest rates through their partnership with Sallie Mae.

It’s worth noting that First Internet Bank highlights no origination fees and no prepayment penalties on their Sallie Mae student loan products. This fee structure could potentially extend to other loan products, but the available information doesn’t confirm this.

Repayment schedules

Understanding repayment schedules is crucial for businesses to manage their cash flow effectively. Here’s what we know about First Internet Bank’s repayment structures:

SBA Loans

SBA loans typically follow a monthly repayment schedule. With terms up to 25 years for real estate loans, this can result in more manageable monthly payments for businesses.

Commercial Loans

Specific repayment schedules for commercial loans are not provided in the available information. It’s likely that these are customized based on the business’s needs and cash flow projections.

Personal Loans

Personal loans feature fixed monthly payments for the duration of the loan. For 60-month terms, payments are $22.25 per $1,000 borrowed.

Auto Loans

• Standard auto loans: $20.33 per $1,000 borrowed for 60 months.
• Horse trailer and RV loans: $9.78 per $1,000 borrowed for 180 months.

Student Loans

Multiple repayment options are available through Sallie Mae, but specific details are not provided in the available information.

Customer Experience and Considerations

While First Internet Bank offers a wide range of loan products, it’s important to consider the customer experience when evaluating a lender. Analysis of customer reviews reveals mixed experiences:

• Positive Aspects: Some customers report competitive interest rates and helpful customer service, particularly in account servicing.
• Challenges: Several customers have reported slow, cumbersome loan processes, especially in underwriting. There have also been complaints about unexpected account closures and last-minute changes to loan terms.

Pros:
– Diverse range of loan products catering to various business needs
– Competitive rates on some products, particularly auto loans
– No origination fees or prepayment penalties on student loans (potentially extended to other products)
– Online-only model may appeal to businesses comfortable with digital banking

Cons:
– Limited transparency on commercial loan rates and terms
– Some customers report slow and documentation-heavy loan processes
– Lack of physical branches may be a drawback for businesses preferring in-person services

In conclusion, First Internet Bank offers a comprehensive suite of loan products that could meet the needs of many businesses. However, potential borrowers should carefully consider their specific needs, comfort with online banking, and tolerance for potentially lengthy application processes when evaluating First Internet Bank as a lender. As always, it’s advisable to compare offerings from multiple lenders and consult with financial advisors before making a decision.

Eligibility Requirements for First Internet Bank Loans

First Internet Bank, as an online-only financial institution, offers various loan products to small businesses. Understanding the eligibility requirements is crucial for potential borrowers to assess their likelihood of qualifying for a loan. Let’s delve into the specific criteria that First Internet Bank considers when evaluating loan applications.

Minimum credit score

First Internet Bank maintains specific credit score thresholds for different loan products: a minimum FICO score of 650 is required for most commercial loans, while SBA loans typically require scores of 680 or higher. These requirements align with industry standards but are notably more flexible than traditional banks, which often require scores above 700. Additionally, businesses must demonstrate at least $100,000 in annual revenue and two years of operational history, according to current lending guidelines (2023). However, this is not a hard and fast rule, and the bank may consider other factors in conjunction with credit scores.

It’s important to note that while 650 is often cited as the minimum, applicants with higher credit scores generally have a better chance of approval and may qualify for more favorable terms. For example, those with scores above 700 might be eligible for lower interest rates or higher loan amounts.

Compared to some other online lenders, First Internet Bank’s credit score requirement is relatively moderate. Some alternative lenders may approve loans for credit scores as low as 500, while traditional banks often require scores of 680 or higher.

Time in business

First Internet Bank typically requires a minimum two-year operational history for most business loan products, though exceptions may apply for SBA loans or well-qualified borrowers. This requirement helps ensure business stability and demonstrates the company’s ability to maintain consistent revenue streams. This requirement demonstrates that the business has some track record and stability, which can be indicative of its ability to repay the loan.

The two-year requirement is fairly standard in the industry, aligning with many traditional banks and some online lenders. However, it’s worth noting that this criterion may exclude newer businesses or startups that haven’t yet reached the two-year mark.

For businesses that don’t meet this requirement, alternative financing options such as business credit cards or certain online lenders specializing in startup funding might be more suitable.

Annual revenue requirements

First Internet Bank considers a business’s annual revenue as a key factor in determining loan eligibility. While the bank doesn’t publicly disclose a specific minimum revenue threshold, reports suggest that they typically look for businesses with annual revenues of at least $100,000.

This revenue requirement helps the bank assess the business’s cash flow and its ability to manage loan repayments. It’s important to note that higher annual revenues may increase the chances of approval and potentially qualify the business for larger loan amounts or more favorable terms.

Compared to some other lenders in the market, First Internet Bank’s revenue requirement is relatively moderate. Some online lenders may approve loans for businesses with annual revenues as low as $50,000, while others might require $250,000 or more.

Industry restrictions

First Internet Bank serves a wide range of industries, but like many financial institutions, they may have restrictions on certain high-risk or regulated sectors. While the bank doesn’t publicly list all restricted industries, it’s common for lenders to be cautious about industries such as:

• Gambling and casino operations
• Adult entertainment
• Marijuana-related businesses (due to federal regulations)
• Certain types of financial services

It’s advisable for businesses in potentially restricted industries to contact First Internet Bank directly to discuss their eligibility. The bank’s loan officers can provide more specific information based on the individual business and its activities.

Geographic limitations

As an online bank, First Internet Bank has the advantage of being able to serve customers across the United States. However, it’s important to note that there may be some geographic limitations or variations in service availability.

While the bank’s deposit accounts and some loan products are available nationwide, certain business loan products may have state-specific restrictions. This could be due to varying state regulations or the bank’s internal policies.

For example, some states have specific licensing requirements for certain types of lending, which may affect the availability of particular loan products in those states. Additionally, First Internet Bank may have different risk assessment criteria for businesses in different regions based on local economic conditions.

Potential borrowers should verify the availability of specific loan products in their state by contacting First Internet Bank directly or checking their website for state-specific information.

Additional considerations

While meeting the basic eligibility requirements is crucial, it’s important to remember that loan approval is based on a comprehensive evaluation of the business. First Internet Bank, like most lenders, will also consider factors such as:

• Debt-to-income ratio
• Cash flow projections
• Collateral (for secured loans)
• Business plan and growth potential
• Industry outlook

It’s worth noting that customer experiences with First Internet Bank’s loan application process have been mixed, according to Trustpilot reviews. While some customers praised the competitive interest rates and helpful customer service, others reported slow, cumbersome loan processes and unexpected changes in terms.

One reviewer mentioned: “The underwriting process will take forever, and they’ll do everything last minute. The whole process is such a drag. So many calls, so many documents.” This suggests that potential borrowers should be prepared for a potentially lengthy and document-intensive application process.

Another reviewer noted a last-minute change in interest rates: “They give me the rate was 2.875% for pre-approval and start the paperwork. I was in the middle of e-signing and got an email from the loan officer with the following: ‘The rate that Fannie Mae was initially showing us was a 2.875%. I was informed just now that this pricing is not eligible and is being corrected by Fannie Mae. The actual rates with credit would be a 4.125%.'”

These reviews highlight the importance of carefully reviewing all loan terms and being prepared for potential changes during the application process.

In conclusion, while First Internet Bank offers various loan products for small businesses, meeting the eligibility requirements is just the first step. Potential borrowers should carefully consider their financial situation, prepare comprehensive documentation, and be ready for a potentially rigorous application process. As with any financial decision, it’s advisable to compare offers from multiple lenders to ensure you’re getting the best terms for your business needs.

First Internet Bank Application Process

First Internet Bank, as a digital-first financial institution, offers a range of business lending options, including SBA loans, commercial real estate loans, and other commercial lending products. While the bank prides itself on a streamlined, technology-driven approach, the application process can vary depending on the specific loan product and the individual business’s circumstances. Let’s delve into the details of First Internet Bank’s application process, examining the steps involved, required documents, typical timelines, and the technology used.

Steps Involved

The application process for a First Internet Bank business loan typically follows these steps:

1. Initial Contact: Prospective borrowers begin by reaching out to First Internet Bank’s commercial lending team. The bank encourages businesses to “Talk to us about your commercial lending needs,” emphasizing a personalized approach from the outset.
2. Consultation: First Internet Bank’s experienced commercial banking relationship managers, boasting an average of 20+ years of banking experience, work directly with customers to understand their specific needs and goals. This step is crucial in determining the most suitable loan product and terms for each business.
3. Application Submission: Following the initial consultation, applicants are required to submit a formal loan application along with the necessary documentation. While First Internet Bank likely offers online application options, given its digital-first approach, the exact method of submission may vary depending on the loan type.
4. Underwriting and Review: Once the application and supporting documents are received, First Internet Bank’s underwriting team begins the evaluation process. This step involves a thorough assessment of the business’s financials, credit history, and other relevant factors.
5. Decision and Funding: Upon completion of the underwriting process, First Internet Bank makes a decision on the loan application. If approved, the bank proceeds with loan closing and funding.

It’s worth noting that while First Internet Bank promotes a “faster, streamlined loan process,” particularly for their SBA loans, some customer reviews on Trustpilot suggest that the process can sometimes be slower and more cumbersome than expected. One reviewer noted, “The underwriting process will take forever, and they’ll do everything last minute. The whole process is such a drag. So many calls, so many documents.”

Required Documents

While First Internet Bank doesn’t provide a comprehensive list of required documents on their website, typical business loan applications generally require the following:

• Business financial statements (including balance sheets, income statements, and cash flow statements)
• Personal and business tax returns (usually for the past 2-3 years)
• Business plan or project proposal (especially for startup loans or significant expansions)
• Collateral information (if applicable)
• Personal financial statements of business owners
• Business licenses and registrations
• Bank statements (personal and business)
• Accounts receivable and payable aging reports

The exact documentation requirements may vary depending on the loan type and amount. For example, SBA loans often require additional forms specific to the SBA program.

It’s important to note that some customers have reported experiencing challenges with documentation requirements. One Trustpilot reviewer mentioned, “So many calls, so many documents,” suggesting that applicants should be prepared for potentially extensive documentation requests.

Typical Timeline from Application to Funding

The timeline for First Internet Bank’s loan process can vary significantly depending on the loan type, complexity of the application, and completeness of the documentation provided. While the bank doesn’t provide specific timelines for all loan types, they do offer some insights:

• For their SBA Express Loan program, First Internet Bank mentions that credit decisions can be made in as little as 48 hours. This suggests a relatively quick process for at least some of their loan products.
• As a Preferred SBA lender, First Internet Bank can offer a faster loan process with reduced paperwork for SBA loans.

However, it’s crucial to note that these timelines may not be representative of all loan types or all applicant experiences. Customer reviews on Trustpilot indicate that some borrowers have experienced longer processing times than expected. One reviewer described the process as “such a drag,” suggesting that applicants should be prepared for potential delays.

For more complex loans or in cases where additional documentation is required, the process could take several weeks or even months from application to funding. Businesses should discuss expected timelines with their First Internet Bank relationship manager during the initial consultation to set realistic expectations.

Technology Used

As an internet-based bank, First Internet Bank leverages various technologies to streamline its lending process and enhance customer experience. While specific details about their proprietary systems are not publicly available, we can infer some information based on their digital-first approach:

1. Online Application System: It’s highly likely that First Internet Bank uses a sophisticated online application system for their business loans. This allows applicants to submit their information and documentation electronically, potentially speeding up the initial stages of the process.
2. Digital Document Management: Given the bank’s emphasis on streamlined processes, they likely employ advanced document management systems to handle the numerous files and forms required for loan applications.
3. Online and Mobile Banking: First Internet Bank offers free online and mobile banking services for businesses, which may integrate with their lending platform to provide a seamless experience for borrowers.
4. Remote and Scanned Deposit Options: These technologies allow business customers to manage their accounts and potentially their loans more efficiently.
5. Electronic Statements: Offered as part of their business banking services, this technology likely extends to loan-related communications as well.
6. Proprietary Scoring Systems: While not explicitly stated, it’s reasonable to assume that First Internet Bank uses advanced credit scoring and risk assessment technologies to evaluate loan applications efficiently.

Despite these technological advantages, it’s important to note that the human element remains crucial in First Internet Bank’s lending process. The bank emphasizes the role of their experienced commercial banking relationship managers in working directly with customers to understand their needs and customize loans.

Customer Experience and Considerations

While First Internet Bank promotes a streamlined, technology-driven approach to business lending, customer experiences appear to vary. Trustpilot reviews reveal a mixed picture:

• Positive Aspects: Several customers reported good experiences with competitive interest rates and helpful customer service, particularly in account servicing.
• Areas of Concern: Some reviewers noted issues with slow, cumbersome loan processes, unexpected account closures, and occasional errors or last-minute changes to loan terms.

One reviewer cautioned about potential last-minute changes, stating, “They give me the rate was 2.875% for pre-approval and start the paperwork. I was in the middle of e-signing and got an email from the loan officer with the following: ‘The rate that Fannie Mae was initially showing us was a 2.875%. I was informed just now that this pricing is not eligible and is being corrected by Fannie Mae. The actual rates with credit would be a 4.125%.'”

These mixed reviews suggest that while First Internet Bank’s application process may be efficient for some borrowers, others may encounter challenges. Prospective borrowers should be prepared for potential variability in their experience and maintain open communication with their assigned relationship manager throughout the process.

In conclusion, First Internet Bank’s application process for business loans combines digital efficiency with personalized service. While the bank offers potentially faster processing for certain loan types, particularly SBA loans, the overall experience can vary. Businesses considering First Internet Bank for their lending needs should be prepared for a potentially detailed documentation process and should discuss timelines and expectations clearly with their assigned relationship manager. The bank’s digital-first approach offers convenience, but applicants should also be ready to engage in direct communication to ensure a smooth lending process.