US small-business borrowing rose in September: PayNet

Category: Small Business Borrowing
Published: Monday, 09 November 2015
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NACFB makes landmark move for unregulated brokers

Category: Small Business Borrowing
Published: Monday, 19 October 2015
Written by Admin
The EGM also held three panel discussions throughout the day, including how government intervention in small business borrowing through high street bank referral is helping the market, what is next for FCA regulation and whether there are record levels of business through the broker channel asset finance market.

Canadian small business lending slips in Aug-PayNet

Category: Small Business Borrowing
Published: Sunday, 18 October 2015
Written by Admin

OTTAWA Oct 14 Commercial borrowing by small businesses in Canada edged lower in August, data from PayNet showed on Wednesday, as companies adjust to the impact of cheaper oil prices on the countrys economy.

PayNets Canadian small business lending index slipped to 128.7 from 130.5 in July. Its index of medium-sized businesses also retreated, declining to 218.1 in August from 229.5 the previous month.

The decline in borrowing from the medium-sized businesses was less surprising because those are firms that are tied to the energy sector, said PayNets president Bill Phelan. But the fall off for smaller companies was unexpected.

It was kind of a surprise because it really means there was a little bit of a step backwards, Phelan said. At just 2 percent growth for small business borrowing compared to a year ago, that barely keeps up with replacement needs for worn out equipment or properties, he said.

Borrowing trends across sectors suggested growth was shifting away from areas related to energy and to more consumer-oriented industries.

The borrowing index for companies in accommodation and food jumped to 272.8 from 265.5, while manufacturing edged down to 60.8 from 61.1.

That means that theres this underlying consumer strength in the Canadian economy, said Phelan. It points to this shift ... its a bumpy road to shift, it always is, but at least its shifting into the consumers hands.

Loan delinquencies edged down in another positive sign.

Moderate delinquencies - those that are behind in payments by 30 days or more - edged down to 1.07 percent from 1.08 percent. Loans that were more than 90 days late similarly declined to 0.32 percent from 0.34 percent. (Reporting by Leah Schnurr; Editing by Diane Craft)

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What to Do When Online Lenders Come Knocking

Category: Small Business Borrowing
Published: Friday, 16 October 2015
Written by Admin

In recent years, alternative lending has become an important tool for small business owners to access credit.

Such lenders, including Inc. 5000 companies OnDeck and Lending Club, spotted an opportunity following the great recession, when banks tightened their credit standards and essentially stopped lending to small business owners. And theyve basically only increased their market share and marketing efforts ever since.

Now, according to this report on the Wall Street Journal, there are so many new alternative lenders, supported by the billions of dollars from venture capitalists, that theyre tripping over each other for customers. While that may seem like a good thing for business owners desperate for credit, its definitely a case of buyer beware.

Quite a few of the more established firms have been in the spotlight in recent months for questionable lending practices. And although they seem to be making efforts to address complaints, the same cant be said necessarily for the new batch of lenders, where interest rates on loans can be exorbitant, and repayment terms extreme.

About 20 percent of small business owners turned to online lenders to secure loans through the first half of 2014, according to the New York Federal Reserves most recent online lending report. Other reports suggest that online lenders could soon capture up to 30 percent of small business borrowing needs.

And online lenders are approving loans for small business owners at a much faster pace than traditional credit sources. In July, such lenders approved 61 percent of loan request, compared to 49 percent for small banks, and just 22 percent for large banks, according to online lender Biz2Credit.