Today’s economy is rough, with many investors having seen better days in the mid-80s and 90s. Thankfully the progress has begun to regain positive momentum - allowing small business owners to once again become granted access to more business loans and leases - in an effort to grow or maintain their companies. Now, these previously cut-off businesses are able to release the disheartening title of “high risk” as they ardently climb towards the top of brawny financial backings and more efficient business operations.
Current Economic Factors Favor Small Business Lending
Although financial experts all have their own varying opinions on the state of the current economy, the general consensus is that the future is bright for small businesses who seek the help of lending establishments. This improvement could also lead to lowered interest rates as well, with an equal deduction in the amount of finance charges imposed on the business. With flexible repayment terms coming out of the woodwork, small businesses will be able to meet their needs while offering consumers and manufacturers more cost effective ways of completing their missions.
According to the Bureau of Labor Statistics, the American unemployment rate was 7.3 percent as of October, 2013. That is a .6 percent drop since January of this year, a change that is bringing more opportunities to small businesses everywhere. In addition, more and more people are gaining an interest in entrepreneurship, a trend that has unfortunately been waning over the past decade. With these improvements, and with the increased access to more lending opportunities, small businesses are beginning to thrive once more in America.
2012 Financial Statistics Paint a Vivid Picture of the Future
In order to better understand the current state of small business lending, you have to understand what last year’s predictions had to show. According to numerous studies conducted by the experts at Equifax, bankruptcies among small businesses are declining – thirty-six percent since the first quarter of 2010 to be exact. What’s more is that the report predicted the decline to continue well into the year 2013, a change that could spell success for many wary small business owners.
Improved Economy Equals Increased Consumer Spending, Thus a More Robust Business
Thanks to reports released by the Bureau of Economic Analysis in 2012, small business owners are now aware that consumer spending is on the rise. Confidence is starting to grow once again as the economy takes a turn for the better. This translates into a more a robust business, an endeavor that inevitably brings more monthly profits to the books. As the unemployment rate decreases and minimum wages increase, small business could see a steep change in their returns.
What it all means for Small Business Lending
This overwhelming economic confidence makes for a more secure business operation, which in turn assuages the worries of cautious lending establishments. As lenders put together their options for small business loans, they will be looking at the statistical data as well. While our nation currently recovers from its last economic pitfall, small business owners and lenders alike are nonetheless clamoring to get that stagnant financial boat moving once again.