In 2010, lending to small businesses, from institutions like Bank of America, Wells Fargo, and CitiGroup, is said to be the one way in which unemployment can be effectively combated. As governmental stimulus programs are said to be temporary and no real fix for unemployment, target a small section of workers, like state employees, or are not set to take place for years down the road, many are left wondering about what are the solutions for the now.
The small business sector of our economy is not only where hundreds-of-thousands of jobs can be created but it’s also the breeding ground for the next big company like Google or Microsoft, which will create more and more jobs as they grow.
So, small business loans from Bank of America, Wells Fargo, and CitiGroup are going to go a long way in restoring the job market and rebuilding our nation’s economy and way of life.
However, many worry that relying on these big banks, specifically Wells Fargo, Bank of America, and CitiGroup, who were all grouped in the banking scandals and bailout programs, is an unsteady foundation seeing as how big financial institutions have a history of only looking out for themselves. In short, many believe small business loans can’t be relied on for unemployment solutions since big financial institutions may either set rates on small business loans at an unaffordable level or refuse to work with small businesses that get in trouble.
Yet, Bank of America, Wells Fargo, and CitiGroup would have to be beyond incompetent to try and stall the growth of small businesses. For one, a small business loan from, let’s say Bank of America, is going to be paid back only if that business grows and prospers and rather than allow defaulted loans on their books Bank of America would need to work with that business to keep them afloat. Also, if the business survives thanks to a loan from CitiGroup or Wells Fargo, pays back the loan and had an excellent lender/borrower relationship, they may return in the future for banking needs.
Many believe the failings in the home loan modification program are due to financial institutions believing they could just foreclose and sell the house again, but such isn’t the case with small businesses. It would benefit not only companies like Bank of America, Wells Fargo, and CitiGroup to lend to small businesses in 2010, but it could go a long way in putting people back to work.
