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ImageSmall business owners are getting frustrated with the banks.  Don’t think that a small business owner does not generate revenues.  Small business owners by alternative finance companies have been defined as those businesses who generate from $100,000 to $10,000,000 in annual revenues.  You have some strong cash flow businesses in that category.

To hear some small-business owners talk, getting a loan remains all but impossible. And yet, many bankers claim that their small-business loan volume is up significantly. So, is the small-business credit crisis over or not?

In reality, it is not.  The fact of the matter is that the guidelines at the banks remain impossible.  Managing Director, for Lendinero Gil Zapata explains what currently happen to one of his clients. 

“Recently, we felt that we had a client that we could take to a local community bank to obtain traditional financing.  The company use to generate $10 Million of revenues and dropped to less than $1 Million in 2007.  However, since 2007 the company after implementing a turn around strategy has grown in excess of 300% and revenues grew from $1 Million to over $3 Million since 2008.  In addition, the company owns a 20,000 square foot facility, over $500,000 in inventory, the equipment, and the owner has a credit score over 680.  However, they took a $25,000 loss on their 1120s in 2011.  After 3 months of submitting over 200 documents to the bank, our client got denied for a loan for $2,000,00 that was going to be secured by the real estate and cash.  This is why over 90% of our lending activity focuses on cash flow and quick credit decisions.  Our clients don’t have 3 months to wait and than get a denial.” states, Mr. Zapata. 

Other business owners have had the same experiences with banks.  This is why there are companies like Lendinero who focus on providing quick credit decisions to small business owners.  The reflection of these credit decisions by the banks is an indicator that the credit crunch still continues with the banks.