MADISON, Wis. (12/17/13)--Credit union approval rates for small business loan applications improved to 44.5% in November from 43.4% in October, according Biz2Credit, a funding source for small businesses.
A Dec. 12 article from the Fox Business Small Business Center advising entrepreneurs on how to apply for their first business loans suggested applicants seek out credit unions as their financial institution of choice.
In the Coleman Report, a small business lending newsletter, columnist Charles Green suggested allowing credit unions to make more business loans is among the ways to increase small business lending. Ty Kiisel cited Green for his Dec. 16 column in the Deseret News. "All my community banker friends now want to hang me up by my toenails, but anything that provides more capital availability is a good idea in my opinion," Kiisel wrote.
Credit union business lending has a growing presence throughout Pennsylvania. A 2014 business lender list, compiled by the Pennsylvania Credit Union Association (PCUA), shows 133 contacts at 32 credit unions that are active business lending institutions.
PCUA has provided the information to the Pennsylvania Small Business Development Centers (SBDC). Credit unions are now more likely to get referrals for business loans from the state's SBDC offices, PCUA said (Life is a Highway Dec. 16).
Credit unions were cited throughout 2013 for the capital support they provided small businesses throughout the Great Recession, and credited with picking up the slack created as banks clamped down on credit to small business owners, for instance by Bloomberg Business Week in June. However, that same Bloomberg article noted the statutory member business lending (MBL) cap is constraining credit unions in their ability to support their small business members.
The Credit Union National Association has been urging Congress to allow credit unions to play a larger role in helping small businesses through MBLs. The statutory cap on MBLs loans, as a proportion of credit union's assets, is currently 12.25%. CUNA says that raising the federal government-mandated ceiling to 27.5% would inject $13 billion into the economy, and help boost employment by 140,000 at no cost to taxpayers.