When you apply for business financing there is actually three types of credit that are reviewed for your approval.
No matter what you're told... personal credit ALWAYS matters... unless it isn't being looked at. For example, when applying for business credit you can use your EIN to get approved and leave your SSN off the application.
When you do this your personal credit isn't even looked at nor is it used for the lending decision but this is about the only exception in the business funding space.
All other funding types including advances look at and care about your personal credit. YES, you can get approved for cash flow financing and merchant advances with bad credit but your repayment terms won't be nearly as favorable then if you had good personal credit.
SBA loans, conventional loans, most other long term loans, and credit lines do require good personal credit for approval in most cases. Collateral and asset type based financing doesn't care about personal credit as much. This is if financing only looks at collateral for approval, not financing where collateral is required for approval.
There is no FCRA in the business world, so lenders will never disclose to you that they pull your business credit when you apply for business financing. But they DO pull your business credit!!!
Just think, you are applying for money for your business, and your business has its own credit profile and score. So of course they will want to see how the business pays its bills on top of how you do as the owner. There is A LOT of money available for business owners, more now than there has ever been in the past. You just need to know what type of financing to go after, once you know that you can more easily find what you need.
Not having establishes business credit makes you look like a rookie, a startup, a "non-established" business. This will lead to denial so insure you have at least 5-10 reported accounts and that you are paying them as agreed.
You actually have three types of credit: Personal Credit, Business Credit and Bank Credit. All three should be good to give you the best chance of approval.
Your bank rating is mostly based on the amount of money you keep in your bank account over the last 90 days. High 5, account balance of $70,000-99,999, Mid 5, account balance of $40,000-69,999, Low 5, balance of $10,000-39,000, High 4, 7,000-9,999, Mid 4, 4,000-6,999 and Low 4, 1,000-3,999.