There are reports which have indicated small businesses are beginning to regain their confidence and are looking for ways to invest in their business and, hopefully, continue to grow and acquire more workers in the near future. Obviously, small businesses are needed to combat unemployment, but there are those who feel that access to capital which can create these conditions have been tight for many companies throughout the year. However, new programs which are set to begin in 2011 from the Small Business Administration known as the Small Loan Advantage and Community Advantage programs are hoped to bring borrowing opportunities and access to credit for more companies.
According to the SBA, these new programs are hoped to offer more small business loans to companies who are in need of smaller amounts of capital, rather than large small business loan borrowing opportunities. Obviously, not all companies have had the opportunity to borrow from financial institutions under traditional small business loan plans, but loans which are typically backed by the SBA have been more widely available and used by financial institutions to provide access to capital which companies need.
It’s reported that the Small Loan Advantage Program will be available to lenders in the Preferred Lender Program, which is hoped to provide more borrowing options for businesses since many of these lenders are those which make the highest volume of small business loans. Understandably, businesses who may see potential for growth have been hindered, according to reports, due to the lack of capital which is being provided by many financial institutions, yet loans which may be guaranteed or backed by the SBA could provide more security for lenders who may be hesitant to offer these types of loans.
Also, the Community Advantage Program is hoped to provide institutions which are particularly focused on community development the opportunity to offer funding to companies in specific areas. Some of these lending initiatives may focus on options like micro-lending or startup companies, and assistance may be offered through this type of lending opportunity to borrowers in order to ensure that they have the best opportunity for success in their company.
Understandably, small business loans are no guarantee for a company in need and there are still challenges which businesses may face in 2011. Yet, with mixed reports stating that banks are not providing small business loan opportunities and lenders saying that businesses have simply been hesitant to borrow, it’s hoped that these new small business loan initiatives from the SBA will provide options for companies who do want access to capital and security to lenders who are in a position to offer these loans to companies in need.