Credit unions score well in small business survey
The Federal Reserve Bank of New York recently released survey results for 2015 lending to small businesses. The survey found that credit unions scored the second best satisfaction rating; just behind small banks. This was quite a feat considering 43 percent more small businesses applied for a loan at a small bank than a credit union. Only nine percent of small businesses indicated that they applied for a loan at a credit union. Most of those applications went to credit unions with more than $10 million in assets. It’s also interesting to note that only 50 percent of small businesses received the loan amount that they applied for with any institution.
The survey results are certainly good news considering the number of small businesses that are in need of loans. Credit unions are making more member business loans. That number will also rise as the NCUA rolls out its new rules for business lending with the personal guarantee no longer being required for credit unions. The Small Business Administration (SBA) is also working more with credit unions to get SBA loans in the marketplace. Right now credit unions account for a very small percentage of SBA loans.
LEVERAGE Business Lending can help credit unions understand the SBA process and also begin to make SBA loans which are guaranteed by the federal government. Contact a LEVERAGE Business Development Consultant for more information.
The Small Business Credit Survey is a collaboration among seven Federal Reserve Banks, including New York, Atlanta, Boston, Cleveland, Philadelphia, Richmond and St. Louis. The survey focuses particular attention on how credit demand, sources, and outcomes vary within the small business sector. The survey is based on responses from 3,459 employer firms from 26 states. It focuses on three sub-segments—startups, microbusinesses, and growing firms, or those with increasing revenues and employees and plans to increase or maintain their number of employees.