Economists and other officials believe that access to capital for small businesses is vital for this nation to see an overall recovery beyond what we have already seen. But then since there are problems faced by not just small business owners but also consumers, questions are being raised whether small businesses are finding the finance that is required to prosper at a time when they are looked upon for job creation and a vital source of economic recovery. There have been mixed signals as regards the status of small business lending. Some big banks assert that they still continue to lend small business loans and at the present time businesses are found unwilling to borrow. But business owners keep on complaining that access to credit is still closed in many cases.
In first quarter of 2001, small business lending dropped 8% in comparison to last year. Financial institutions are reporting that they are making loans but then borrowing means may not be as open as may be thought. It does not mean that borrowing opportunities have gone down but then there is not enough opportunities open as may be required at current time.
When it comes to small businesses, there are still questions raised whether access to credit is available to them. Small businesses are seen as necessary for job creation and small business owners are finding conflicting reports or advice from officials. Some officials keep asserting that smaller financial institutions will face problems getting loan funds. While other officials feel that small businesses have a better chance of using credit unions and smaller financial institutions for fulfilling their borrowing needs.
This article was submitted by Raj Tulshan, Director of Business Development of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to