Small Business Loan Alternative Options From The Small Business Lending Fund–More Options From Community Banks

The capital for small businesses in the form of loans has been a central issue among some politicians, economists, and many small business owners as there is concern that the lack of access to credit for these companies can hinder growth and job creation, so as a result there has been some focus in the area of small business loan opportunities, like those from the Small Business Lending Fund, that could offer borrowing options from alternative institutions like community banks. We recently saw at the end of September that the Treasury Department was providing funding to various institutions across the nation in the hopes of allowing these community banks to help small businesses, but questions over whether the state of small business lending will be helped by this act have arisen as there are also other banks that are reportedly committing more funds to business loans as well.

While it’s hoped that in the coming months and years we will see an increase in the available credit that small businesses may be able to use to their advantage, programs that help community banks lend to small businesses will hopefully provide the alternative opportunities that some companies need as not all of the business owners who are looking to improve upon their company, take their business further, or expand with the use of these funds are getting the help they want from major financial institutions.

Some businesses have benefited from turning to alternative small business loan options like those available from community banks or credit unions simply because the lending standards that some of the major small business lenders have in place do not allow for certain businesses to borrow despite the fact that financing from a loan could be greatly helpful. While small business loans are not always the answer to the needs of the business nor will it automatically create jobs if a company is allowed to borrow, there are both reports that businesses are unwilling to borrow at the current time and some banks unwilling to lend, which both usually stems from uncertainty about the future of the economy, consumer spending, and the ability of these businesses to repay these loans.

Over the past months we have seen some business owners turn to a variety of alternative options like online peer-to-peer lending networks, financing from investors rather than loans, or some simply bypassed large banks and turned to community institutions or credit unions for their small business loan needs, and for those who opt to work with a community bank it is hoped that funds that had recently been offered from the Treasury Department will allow these institutions to better serve businesses in this capacity. Again, it’s been stated that small business loans are not necessarily going to solve the unemployment crisis nor will it always guarantee a business will see success from the use of these funds, but as we continue to see problems with high levels of unemployment it’s hoped that businesses who are looking to access credit will be able to do so thanks to measures that are putting funding in the hands of banks who can hopefully make this capital available to these companies in a beneficial way in the coming months.