Small Businesses Still Struggle to Obtain Loans

Nov 16th, 2009 @ 8:24 AM by Debbie Dragon

Even with government stimulus programs, small businesses are constantly struggling just to stay afloat. Small businesses help to create as much as 80% of new jobs, so this is dismal news for our struggling economy and especially our rising unemployment rate. Many small businesses have faced reductions in bank credit and it has been increasingly difficult for them to get a small business loan. Overall, they are struggling at record high rates. Could help be on the way?

This week the Obama administration has a meeting planned that could brighten the future for the small business owner. Timothy Geither, treasury secretary, will be meeting with small business owners as well as members of Congress and lenders. The goal of the meeting is to brainstorm for new ideas to help alleviate the struggles that small business owners are having in terms of getting money to operate their businesses. To date, other meetings and stimulus packages for the small business owner have not produced any kind of satisfactory results.

Critics are not so sure this meeting will produce any new outcomes that will actually benefit the small business owner. The American Small Business League is very skeptical. They claim that the Obama Administration does not have genuine intentions. So far, less than 1% of stimulus money has gone to legitimate small business owners. They are afraid the meeting will not produce and real results, and in fact are concerned that more harm than good could very well be the outcome.

Their biggest concern seems to be with the strong possibility of a proposed loop hole that could occur with a new stimulus package. The loophole would allow wealthy venture capitalists to get their hands on loan money that should instead be going to rightful small business owners.

Meanwhile, struggling small business owners must sit and wait, or look to other means to front business operation costs. Only time will tell if the small business owner will actually survive our current economic recession.

One Response to “Small Businesses Still Struggle to Obtain Loans”

1. Becky Wilson says:

   November 21, 2009 at 12:07 pm

   Part of the problem is that small business to the government and in the stimulus packages cover such a wide range of income and size. Small business owners who are truly SMALL like me (under 10 full time employees) rarely see any help at all.