Though things have not yet changed dramatically for small businesses, but the situation has stopped getting worse. Ben Bernanke, Federal Reserve Board Chairman stressed that improvements can take place and it has already started to show up. This year, it is definitely going to be better for small business lending.
Sheila Bair, FDIC Chairman, also agrees to the views of Bernanke. According to her, most banks have become profitable again and they are working on their troubled loans. Lending activity is going to pick up if things continue to remain the same as it is now. The comments of Bernanke and Bair came in a forum “Overcoming Obstacles to Small Business Lending” at FDIC office, Arlington.
The findings of ‘National Federation of Independent Business’ match with that of other regulators. Credit condition has improved and is much better compared to 2008 but is still below pre-recession level. Lending to small businesses contracted significantly due to ongoing financial crisis but it has cut-down less at community banks.
When banks are healthy they are more capable and can lend better. Lending in 2011 is going to increase according to Thomas Bell, Chairman U.S Chamber of Commerce. Small businesses will find a positive environment due to two-year extension in tax breaks of Bush era.
The overall economic environment will have a positive impact particularly as far as small businesses are concerned. The reasonable tax rate that lasted for last two years has added to optimism.
Business can become stronger and the much required “virtuous circle” can be created with sale growth. A 3 to 4 percent growth in business in 2011 seems reasonable enough. This will definitely bring growth in the economy with more sale and business for all sizes of companies.
This article was submitted by Rohit Arora, co-founder of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to