Small businesses seeking startup funds or a fresh infusion of cash are having an easier time obtaining bank loans, according to recent earning results.
Outstanding commercial loans with the six largest banks in the U.S. are more than eight percent higher than this quarter last year despite a slight decrease in approvals between February and March. Small banks and credit unions are joining the lending party as well, with approval rates at 51.6 and 43.6 percent respectively.
A combination of increased demand and relaxed lending standards is responsible for the uptick in small business loans, as well as big banks’ focus on commercial lending to offset slowed consumer borrowing through auto loans and mortgages. In addition, many small businesses have benefited from the Small Business Administration’s Advantage loan program.
While the small business loan climate is warming, however, it is important for small business owners to consider the obstacles to small business lending that still exist. Lending standards, while relaxed from the reactionary policies following the 2008 recession, are still strict enough to disqualify many startup businesses without sufficient credit history or collateral. In addition, the approval process may still be prohibitively long due to a lack of automation.
If small business lending is still freezing your company out, invoice factoring for small business can help. Streamlined, business-friendly approval processes mean you get the cash you need within days instead of weeks or months. Contact Factor Finders to learn more about our small business invoice factoring services and to get started today!