Traditional Lending for Small Businesses: The Underserved
Posted 08-15-2023 at 12:25 PM by Allday24
Imagine this: The benefit of tailor made approaches for an industry when banks fail small business needs. What is better than that? -Having funds released that already have your name on it. When you grab hold of it, they’re cookie-cutting solutions and alternative avenues to capital. All the more detailed and leaning over into the depths of what makes a business tick, and aligned to the framework of revenue for small business. -Financial possibilities with no bounds? Ok, maybe I went too far with that last line, but I’d sure like it!
What is to be considered is whether small business "ABC" has traditional lending with banks as an option, or small business "XYZ" has the advantages with alternative lending, there are still guidelines. Alternative lending just has a very creative look at getting small business owners qualified with tailored solutions and considerations for how revenue is derived. Traditional banks will continue to have its pool of customers and so will alternative lenders. That is all attributed to what will always be variances in the pools of qualifying postures from one business to another. Traditional lending still won’t do what alternative lending does. -And that is, go outside of the parameters of exceptions, because even that has an invisible parameter they won’t venture so far away from.
Kudos to Goldman Sachs in their push for legislation to have SBA and its two decade plus process changed. Really SBA? Even McDonalds incorporated healthier options when they gave customers salad.
What can we expect? I can’t wait to see the chain of events set off for traditional lending as a result. In what direction will they go and will banks then use the SBA’s new found way of doing things as a guide to inspire meaningful changes of their own? I don’t know about anyone else, but I can’t wait to see what becomes of it all. There is one thing that will stand true from the jump. SBA modifications are only like a plucking of a straw in the sheaf when it comes to the stringent lending guidelines across our banking systems for small business owners. The gap between traditional lending getting money into the hands of more small business owners, and doing so creatively, is a risk I am not so sure they're willing to close in on.
What is to be considered is whether small business "ABC" has traditional lending with banks as an option, or small business "XYZ" has the advantages with alternative lending, there are still guidelines. Alternative lending just has a very creative look at getting small business owners qualified with tailored solutions and considerations for how revenue is derived. Traditional banks will continue to have its pool of customers and so will alternative lenders. That is all attributed to what will always be variances in the pools of qualifying postures from one business to another. Traditional lending still won’t do what alternative lending does. -And that is, go outside of the parameters of exceptions, because even that has an invisible parameter they won’t venture so far away from.
Kudos to Goldman Sachs in their push for legislation to have SBA and its two decade plus process changed. Really SBA? Even McDonalds incorporated healthier options when they gave customers salad.
What can we expect? I can’t wait to see the chain of events set off for traditional lending as a result. In what direction will they go and will banks then use the SBA’s new found way of doing things as a guide to inspire meaningful changes of their own? I don’t know about anyone else, but I can’t wait to see what becomes of it all. There is one thing that will stand true from the jump. SBA modifications are only like a plucking of a straw in the sheaf when it comes to the stringent lending guidelines across our banking systems for small business owners. The gap between traditional lending getting money into the hands of more small business owners, and doing so creatively, is a risk I am not so sure they're willing to close in on.
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