According to a FDIC survey, despite holding only 13% of banking industry assets, the data showed that community banks hold 42% of small business loans.
Low interest rates and high levels of regulation are preventing the UK’s traditional banks from lending to small businesses. Andre Hakkak and Thomas Otte suggest this situation provides opportunities for alternative lenders to step in.
Analysts from the Cleveland Fed noted that since the Great Recession bank lending to small businesses has fallen significantly, with bankers blaming small business owners and regulators and small business owners, in turn, saying the problem rests with bankers and regulators.
After stepping backward in Q1/13, small business investment jumped forward in the last two months, according to the Thomson Reuters/PayNet Small Business Lending Index.
PayNet said small business owners lack a bullish outlook on business expansion, as the Thomson Reuters/PayNet Small Business Lending Index decreased to 98.5 in March from a revised 105.4 in February.
March 2013 continues a trend of growth in small business lending demand, according to Direct Capital’s Monthly Small Business Lending Index.
The Treasury Department said Pennsylvania institutions receiving capital through the Small Business Lending Fund continue to increase their small business lending, in total by more than $445.4 million over baselines.