Small Business Borrowing Opportunities–Will SBA Loans Provide More Access To Capital?

Small business loan opportunities have been sought out by various business owners over the past months and many have turned specifically to SBA loans as a way to access capital for their company. Obviously, unemployment has been a great burden on the US economy and many small businesses have been called on to create the jobs which are needed to combat this problem. Yet, there have been some complaints that financial institutions are not providing access to capital which is needed in order to help businesses expand in a way that will necessitate more jobs.

However, there may be opportunities for small business loans from the SBA as changes from past legislation are still available to provide borrowing opportunities for certain businesses. As an example, according to the SBA website, the Small Business Administration has enhanced certain provisions for their loans which will allow them to guarantee up to 90% of an SBA backed loan, with reduced fees, through December 31.

While there have also been increases in certain loan limits, there are also reported changes in eligibility requirements for businesses, which is hoped to open up more borrowing opportunities for certain companies which may have previously been unable to qualify for an SBA loan. However, there are still complaints from business owners which center around the fact that some financial intuitions are simply unwilling to let businesses borrow, even if the loan is guaranteed by the SBA.

On the other hand, there have been reports from the financial industry which have stated that small businesses are simply not looking to borrow at the present time and, as a result, lending practices have not been tight but demand for loans has been low. There have even been some reports which have indicated that financial institutions have eased their requirements for small business loans, but again, companies are simply not looking borrow.

While some businesses have turned to smaller, community banks in order to seek out lending opportunities for their company, it is true that some businesses have been hesitant to borrow due to uncertainty in the economy. Yet, arguments against caution have stated that businesses who are unwilling to invest into their company or create jobs, not to mention banks which may be unwilling to lend, are creating a slow economic recovery which has led to uncertainty by business owners and banks.

SBA loans are not guaranteed for every business and not all companies may qualify for a small business lending opportunity, but there are some indications which show that companies may have more lending opportunities at the present time as legislation which was passed at the end of September is hoped to still be helpful for businesses who are seeking lending opportunities and will provide help to financial institutions when lending.