Nov. 29, 2010


Comments

 
 
 
  • Small businesses are finding much greater success in securing funding from credit unions, community banks, and micro lenders than they are from big banks.



    Biz2Credit research shows that the non-bank lenders, such as credit unions, are are providing much of the capital to small businesses at the moment. Why?

    1) Credit unions are local in nature, are more connected with the small businesses in their areas, and do manual underwriting(Bigger banks are more automated and less flexible with regards to credit scores.)

    2) Community-based lenders understand issues related to lower credit scores and are usually less rigid about their funding parameters.

    3) Credit union decision-making is often quicker, and they are willing to provide more money as a business grows. Many times, they can give better interest rates than the bigger banks.

    4) What really drives the lending is the simple fact that credit unions and other smaller lenders make money only by making loans. (They are not investment bankers and don’t generate much revenue from anything other than loan-making.)

    - Rohit Arora, CEO

    Biz2Credit (www.biz2credit.com)
    Rohit Arora
     
     
     
 
Advertisement