This article from the Institute for Local Self-Reliance (www.ilsr.org) reports on the findings of a 2014 survey of 2,602 small businesses from all 50 states and the District of Columbia. These businesses range from startups to those who have been in continuous operation for more than a century. The median age of them is 13 years and the aggregate employed is 30,049. It found that of those businesses only 1/3 had applied for a loan in the last 4 years. Of those applicants, 42% were denied or received less than they needed. Further, those small business owners who did get financing report that in the last 4 years, 29% have had their lines of credit reduced and nearly 10% had their lines called in early by their lenders.
On the lending side, it found that while the 4 biggest banks in the nation control 45% of all the banking assets, they accounted for only 16% of small business loans. Credit unions have severe restrictions upon small business lending (only 1/3 of them do so) but still account for 7% of small business loans. The Small Business Administration, according to the report has reduced its “small loans”; those of $150,000 or less from an annual 80,000 in the mid-2000’s to about 24,000 today. In this period, the average sized SBA loan has doubled to $362,000.
Small business growth accounts for more than two thirds of job growth in America. The banking market concentration into a small number of Wall St. dominated institutions is starving the job creators of capital.