Small Business Lending at Highest Level since 2008
A new report from the Thomson Reuters/PayNet Small Business Lending Index has found that small business lending hit a four-year high in November. The lending index jumped by 18% between November 2010 and November 2011. It's now at its highest level since February 2008.
The demand for small-business loans is rising as sales increase and businesses become more creditworthy, one small-business lending broker told The Wall Street Journal. A separate survey from Sage North America found that although fewer small businesses were applying for these loans, more of those that were applying were able to secure them.
This might mean that small businesses are coming around in regards to the current economy. Small businesses may not be contracting as much as they used to be, and some may be in a position to expand or to fund expansion through these loans. The biggest thing right now that may be giving small businesses some uncertainty is the 2012 presidential election, where the possibility of new taxes or restrictions is still in limbo.
Even so, this increase in small business lending is an indicator as to the direction of the economy, and an indication of how small businesses may be perceiving 2012. This small business lending index also revealed that the annual pace of economic growth in the fourth quarter of 2011 is expected to top 3% — up from 1.8% in the third quarter.