Small Business Lending

FEEFIGHTERS PRESENTED BY SMALL BUSINESS LENDING THE TRUTH BEHIND BANK LENDING Use of Loans in Big vs. Small Businesses 100% 94% use loans BIG BUSINESS SMALL BUSINESSES DON'T USE LOANS Most small businesses do not use bank loans because: • They don't qualify for loans from banks • Banks don't market loans to small businesses • Bank loans are a hassle compared to options such as credit cards 42% use loans Small Business 25% THEY SAY AVAILABILITY OF CREDIT IS A PROBLEM Hundreds of thousands of small businesses complain about the availability of loans. Since small businesses account for the majority of economic and job growth, lack of bank credit is a big problem. 420,000 600 of 6 million small businesses have problems getting loans of 60,000 big businesses have problems getting loans AND ARE MORE LIKELY TO TURN TO NON TRADITIONAL CREDIT SOURCES CREDIT SOURCES IN CREDIT SOURCES IN SMALL BUSINESS BIG BUSINESS Due to the difficulty in obtaining loans from banks, small businesses have turned Other to a number of alternative means for financing. Sources 90% Some of these include owner financing, personal credit cards, trade credit, friends and family, and leases. 10% Bank BECAUSE THERE ARE FEWER SMALL BANKS, AND THEY HAVE REDUCED LENDING TO SMALL BUSINESSES % of total number of loans going to small businesses % of loans from small banks going to small businesses Total number of community banks 1996 1996 1996 12% 50% 14,000 12% 50% 14K 10% 40% 12,000 2007 8% 30% 9,000 8% 2007 2007 28% 20% 7.3K 6,000 4% 10% 3,000 2% Over the last eleven years, the total numbers of loans granted to small businesses has decreased by one-third. In the same time period, the number of loans going from small banks to small businesses has decreased by almost 50%, The number of community banks has also decreased by about 50% in the last eleven years. Community banks have become a less realistic source for small business loans.

Small Business Lending

shared by youcom on Dec 28
Small businesses are an important part of the U.S economy but the truth is that they have a hard time getting traditional bank loans. This infographic provides information for how small businesses get...


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