TORONTO (5/23/13)--Like credit unions in the U.S., Canadian credit unions continue to outperform banks in serving the financial needs of small and medium-sized enterprises, according to a Canadian Federation of Independent Business (CFIB) research report.
"Banks need to pay close attention to the report's findings if they are serious about serving the small business market," said CFIB Vice President of Research Doug Bruce. "Overall, credit unions do the best job of serving entrepreneurs, while Scotiabank and BMO are tied in receiving the highest overall scores among the big banks. CIBC is the worst big bank for small business--that's the same as it was in 2010, when we issued our previous banking report."
The report, CFIB's Battle of the Banks, provides bank scores based on nearly 13,000 survey responses from small business owners on four key issues: Financing, fees, experience with account managers and service.
Battle of the Banks shows a trend: The smaller the business, the lower the overall bank score. Compared with larger businesses, smaller firms have a tougher time getting the financing they need from their bank, the report indicates.
"Access to affordable financing and banking services is essential for hard-working entrepreneurs, and it's clear that all of the banks should do more to serve small-business clients," said CFIB President/CEO Dan Kelly.
CFIB is Canada's largest association of small and medium-sized businesses with 109,000 members nationwide.
In the U.S., credit unions continued to lend to small businesses in aftermath of the financial crisis, while banks largely withdrew from lending and stayed on the sidelines, News Now has noted. The Credit Union National Association is urging Congress to raise a cap on credit unions' member business lending to 27.5% of total assets from 12.25%. This would open up more opportunities for credit unions wanting to serve small businesses. Raising the cap would inject $13 billion in loans into the U.S. market and help create 140,000 jobs, CUNA said.