Did you know that, according to the Small Business Association (SBA), small business created 65% of new American jobs over the last 17 years? It is common knowledge that the job market is not doing particularly well. Turning our attention to the companies that create jobs, such as the 28 million small businesses all across the U.S., can change that. Why are a growing number of companies supporting small business loans, and how can companies choose from traditional and independent lenders?
Small Business Loans On the Rise
Just last year, in 2012, the Portland division of the SBA loaned $457 million to small businesses. Experts agree that small businesses, or companies with less than 500 employees, can greatly benefit from short term business loans. According to the president of the U.S. Bank in Oregon and southwest Washington, Malia Wasson, “Here in Portland, SBA loans have helped owners invest in their businesses by purchasing new equipment or freeing up cash flow to hire that extra employee and keep up with demand.” Providing small businesses with necessary capital, however, does not benefit the companies alone. Small businesses continue to create new jobs, encourage expansion and growth, and support the local and federal economy.
Traditional Vs. Alternative Lenders
Wondering how to improve cash flow for your small business? A number of traditional and alternative lenders are more than willing to support small businesses. Traditional lenders include financial institutions, such as banks. Financial institutions may require a slightly longer screening process (approximately 30-60 days), and have fairly strict guidelines for approval. Forbes.com reveals that traditional lenders, however, typically offer lower interest rates.
Alternative lenders, on the other hand, often consist of independent loan companies. Businesses may be approved by traditional lenders faster, sometimes within as little as 24-48 hours. Alternative lenders tend to be less rigid about the approval process, including financial history and credit score criteria, and they can also offer much more flexible plans.
Stop asking how to improve cash flow. Take advantage of increasingly popular small business loans, and carefully weigh the pros and cons of traditional and non-traditional lenders before applying.