Citadel CEO Says Small Business Lending Starts Before the Application

Watch more: Need to Know With Citadel Credit Union’s Bill Brown

Small businesses can be profitable on paper and still find themselves short of cash when payroll, inventory or equipment bills arrive before customers pay their invoices.

That mismatch is shaping conversations between small business owners and lenders in southeastern Pennsylvania, according to Bill Brown, president and CEO of Citadel Credit Union. Rather than beginning with a term loan or a large capital request, many discussions start with the less conspicuous problem of managing money moving into and out of the business.

“The kinds of conversations we’re having with small business owners really revolve around: How do they manage their liquidity better?” Brown told PYMNTS. “How do they manage the cash flows associated with their businesses better?”

The timing can matter as much as the amount. Brown pointed to businesses operating with payment cycles ranging from real time to 30 or 60 days, leaving owners to finance the interval between delivering goods or services and getting paid. For that reason, a line of credit is often among the first borrowing options discussed.

Higher rates have changed the calculation without eliminating demand for credit. Business owners generally recognize that the unusually low rates seen several years ago aren’t likely to return soon, Brown said. The result is a more deliberate discussion about why the business is borrowing and what the borrowed money is expected to accomplish.

“The taking on of debt and the extension of credit has to match up to their business story and what their intentions are for their business,” Brown said.

A loan or credit line, in that context, needs to support a larger operating plan rather than serve as capital without a defined purpose.

Preparing a Business to Borrow

The distinction becomes particularly important for owners seeking business credit for the first time. Some arrive at that point without having prepared the financial pieces a lender needs to evaluate the request, Brown said.

“For many business owners, this is their first time applying for business credit,” Brown said. “This is their first time in their business lifecycle where they had to think about taking on additional debt, and in some cases, they haven’t prepared for it.”

Education, therefore, can involve explaining how billing practices, balance sheets, receivables and cash flow affect credit decisions, Brown said. A rejection can become an opportunity to show an owner what would have to change before another application. Owners may overlook assets or other financing vehicles because they consider the business in isolation rather than examining their broader financial position.

Credit unions have their own educational problem. Some small business owners still associate them with the institutions their parents or grandparents used and don’t realize they offer business deposit and lending products, Brown said. Local chambers and civic organizations are often where owners first encounter credit unions as commercial providers.

Underwriting is also moving beyond a simple credit score decision. Citadel has moved from traditional score-based models toward debt-service and repayment models that use other methods to evaluate business loans, Brown said. However, the lender still needs to understand the business model, the owner’s strategy, the industry and the person putting capital into the company.

Technology sits alongside that work. Lending, mobile, online and other digital platforms can make interactions easier while preserving access to bankers, Brown said. Citadel serves primarily southeastern Pennsylvania and had more than 10,300 business accounts at year-end 2025. Commercial loans rose 14.6% to $474.4 million, while business deposits increased 11.6% to $357.7 million.

The next priorities include responding to business concerns about fraud, improving cash management, and making lending decisions and money available faster, Brown said.

“Business owners care about running their business,” Brown said. “They don’t want to be running their banking.”

Watch the full interview with Citadel Credit Union’s Bill Brown to learn more about:

How lenders can shorten the time between a credit decision and access to money.

Why fraud protection is becoming part of the small business banking conversation.

Which new products and services business owners are asking financial institutions to provide.