The state of the small business credit market has been a matter of considerable debate in recent years. While some analysts are arguing for greater government stimulus, others claim lending is flowing freely.
The National Federation of Independent Business, for example, reported earlier this month that only 9 percent of small business owners in January did not meet their credit needs. On the other hand, Gallup economist Dennis Jacobe has held that Congress needs to invest more in bank lending incentives to spur activity.
Another consideration that many analysts are now making is how lending trends shift from market to market and region to region. Take Massachusetts, for instance. Banks in the state's central region have managed to increase their portfolios by several hundred million dollars since 2008. However, nationwide small business lending has dropped 14 percent for all banks.
"Banks with assets of $300 million to $500 million, which most closely fit the Central Massachusetts banking profile, have seen a 23 percent decline in small business loans across the country," writes Matt Pilon for the Worcester Business Journal. "Even savings institutions … saw their portfolios drop 7.5 percent in Massachusetts and 11.4 percent nationwide."