Bank Accounts Deregulated
Back in 2008 the government took over the largest single unregulated retail banking system in the world andderegulated the largest commercial finance market. What does this mean to the average small business owner?
No Longer Access to Bank Lending – Because bank lending has been deregulated, small business owners can no longer rely on the bank to lend money to them. The small business community has been relied upon by the bank to lend money to people who need to borrow money to start a business or expand a business. 비대면 신용대출 해주는 곳
Over the past ten years bank lending to small businesses has dried up because it no longer makes sense for the banks to be lending money to these businesses. The lending standards before the bank bailout took the large commercial lending institutions down. This was a direct result of the American Small Business Lending Manufacturingdt Crist Mitch doses (ASHL) who were not lending money to these businesses but only to “bad credit” borrowers.
According to the SBA last year there were only 16,000 small businesses receiving bank financing costing the business owner almost $83 per loan an hour. This has forced many small businesses who had been able to build profitable businesses prior to the bailout and restructuring to close their doors.
This has prompted many more small businesses to seek cash input to start-up, expand, or even remodel their businesses due to the fact that there are no bank loans available. The fact that bank lending has dried up only makes you wonder whether or not bank Regulus bill has anything to actually help any business owner?
If bank lending reduction is not going to help business owners then I don’t know what can. Small business financing and bank lending make sense because without the banks there would be no banks that would loan out small business loans to entrepreneurs. In essence the bank would not be in business long term.
So what can government Regulators do to help some businesses and the entrepreneur that needs capital to start a business? The solution is two fold. First they have to step in and regulate the banking industry itself. The banking industry in my opinion should have been regulated by the government because they are the ones that cause the economic headaches for businesses.
The government should have looked at all the shady practices prior to 2008 along with the high levels of default and foreclosures that were occurring, all with no regulatory relief. The fact of the matter is that after the 2008 financial collapse we are still faced with many of the same issues and one of these issues is the unregulated banks lending business.
Next we will most likely experience with increased rate borrowing due to credit challenges as well. Increased credit rates only makes credit and loan approvals even harder because businesses need credit to make credit sales. The banks lending policies before the government bailout only gro honed the borrowers and not the banks in the lending markets.
How this will cause a recession is not my prediction at all. But I would like to thank my friend indirectly that had a vision and did something about it. A recession hurts all of us personally and as a nation but when you can’t fight the money, you can’t even fight the economy.