Small business financing is heading in a new direction. The journey for small business loans is likely to have all the adventure and uncertainties experienced by a wagon train over a century ago. As historians know, wagon trains often encountered serious obstacles even when they were led by expert wagon-masters. What we are seeing now with commercial financing and working capital loans also suggests that results for commercial borrowers will be confusing, uncertain and painful at times. With commercial loan expert help, small business owners should have better results but should still anticipate unexpected challenges along the way.
One of the key factors impacting the new directions for small business financing is that banks and other commercial lenders have changed so dramatically in a very short period of time. These changes are not expected to be temporary in nature. With multiple bank examples, the new directions for commercial borrowers are not optional or voluntary. In most cases, if business owners do not quickly move in a new direction for their business financing, they will be without reliable working capital financing and commercial loans.
Because commercial lending is extremely competitive, new lenders have emerged to replace the old ones. As business financing moves in a new direction, the banking industry is beginning to resemble other aging industries such as automobile manufacturers. While the similarities are probably not welcomed by many bankers, small business owners will now find that their business finance and working capital financing choices might have improved as a result.
