Recently the Treasury Department reported that they would be releasing funds that can help small businesses through a new loan program that is set to begin in 11 states and Washington DC, in the hopes of offering financing opportunities that will help these small companies grow and potentially prosper in a way that will be beneficial for the overall economy. Many have said that small businesses will be one of the key leaders when it comes to reestablishing employment opportunities and leading the economy out of our current situation, but there are some business owners who are in a position where they cannot access the funds they need and this program may not be available in a specific area.
However, simply because the Treasury Department has released the funds to states which will hopefully expand small business borrowing opportunities, this does not mean that all business owners who are in a state that has not received this assistance are in a position where small business loans are not available. While there have been stimulus programs in the past that were hoped to make funding available to companies in need, there are still some banks that hesitate to offer loans to companies, particularly those companies that are in a position where they may not have a long business history or are relatively small.
Yet, there are alternatives that small businesses may be able to use outside of this particular Treasury plan, despite the fact that it’s hoped that companies in states where this funding has been made available will see more borrowing options in cases where businesses are looking for this particular type of financing. For businesses who are looking at these alternatives though, some companies have been able to benefit from looking to small community banks or even regional banks for the loan opportunities they need, but there are also some reports that credit unions are lobbying to be allowed a bigger stake in the small business lending arena as they want the caps on the amount of their funds they can contribute to small loans to be increased.
There are also some companies who may benefit more from micro-loan opportunities, which are simply a smaller small business loan option they can be helpful for certain companies that may not need a sizable amount of capital to help their business move forward. However, some of the problems that have arisen surround the fact that some business owners, particularly new entrepreneurs, may be unsure of how to best use the funding they receive, and if a business owner does not offer a proper business plan, and outline what they expect to do with the funding they receive, this could be one reason that these businesses may be denied the funding that they seek.
Also, some businesses have hoped to get opportunities for financing through investors, as this is ideal for certain companies since businesses may be in a position to work with either a venture capitalist or an angel investor as a way to get funding for a company in the form of investment, which would not have to be paid back under terms like those that come with a small business loan, but many investors are often former business owners or have a good deal of knowledge in a particular area where a business may be working, and these resources could better help certain businesses make use of the financing they have so that they can become more prosperous down the road.
Essentially though, it’s hoped that current small business loan and financing opportunities, as well as programs like this recent one from the Treasury Department, will not only give businesses the access to credit that they need but will allow these companies to ultimately become more successful and, in the end, be able to hire more workers and contribute to the restoration of the economy and job market.