Recently, it was reported that a new small business lending initiative for California was approved and is hoped to not only offer more small businesses borrowing options but will also aid in job creation as unemployment across the nation still remains low, and California is one of the states that has been particularly hard hit by the recession and still struggling to recover and many areas.
According to the Treasury Department website California was approved for this small business lending plan from the State Small Business Credit Initiative, which should offer at least $1.7 billion in additional small business lending, that again, may aid the state in not only business growth and economic prosperity, but job creation as well. For months there have been many who have called on major financial institutions to begin loosening their credit practices and allow more small businesses to access capital through loans or other forms of credit, but many of the major banks have practiced more frugal lending habits until recently.
There are indications that many major financial institutions have been offering more lines of credit, like credit cards, and there are also some reports that states small business lending has picked up in certain areas. Yet, areas like California which are still suffering and sectors like housing are still in need of an injection of capital into various areas, like small businesses, so that there state economy may become more conducive to growth overall as homeowners in California who may be struggling with unemployment, obviously, will need decent opportunities so that they can get back on a stable financial ground.
Many feel that small businesses have been hindered by a lack of access to capital over the past months, but with new programs from the SBA, as well as, small business lending initiatives from various state agencies, it’s hoped that the economies in these particular areas will begin to prosper more so as businesses are able to grow, consumers begin to spend once again, and jobs are created as a result.
There have been companies who have had difficulty finding small business loan opportunities in various areas who have turned to smaller financial institutions, like credit unions or community banks, but there are still many business owners who have claimed that the ability to borrow for their company and, essentially, reinvest in their business to promote prosperity and growth have been difficult to come by, especially in 2010. Yet, with these state small business lending initiatives and federal programs, it’s believed that more businesses now can access capital that can not only make them more prosperous, but better their state economy, job market, and hopefully the overall national economic condition as strides are made towards economic improvement and stability.