Easier Lending Could Boost Economy
New research released recently by the National Federation of Independent Business shows that small businesses are finding it easier to borrow the capital they need to run their businesses. According to the survey, only 4% of small-business owners said that all their credit needs were not met, matching a historic low. In addition, an index compiled by Biz2Credit, which connects small businesses with lenders, shows that 17.6% of small-business loans were approved by large banks in December, up from 17.4% in November, and are now at the highest level since the company began tracking data in 2011. Finally, about 12% of large banks surveyed by the Federal Reserve back in October said that credit standards for small businesses had eased somewhat in the prior quarter, while none said that standards had tightened. Overall, the improved climate is likely to provide an economic boost in coming months.
What It Means Going Forward:
With the economy slowly improving, banks appear to be more willing to lend to small businesses. While lending has not yet reached pre-recession levels, it continues to improve.
Additional Reading:USA Today ran a very positive piece on small-business lending over the weekend, while the NFIB Data and the Biz2 Credit Report are available online.
This news article is intended to keep small business owners apprised of current events that may affect them. It does not necessarily reflect NFIB’s policy position on such issues.