Big Banks to Increase Small Business Loans in 2010

Big Banks have started to answer to the government and the nation, claiming that they will significantly increase small business loans this upcoming year in 2010.  However, no information has been released on how the banks plan to do this, or what requirements they will have.  Furthermore there is a question of what qualifies as a small business as there is no standard for this.

JPMorgan Chase & Co. plan to extend an addtional $10 billion to small businesses, along with Wells Fargo & Co. and Huntington Bancshares Inc. who plan to increase loans to small businessesto $16 billion and $1.2 billion respectively.

The majority of small businesses rely on banks for funding as opposed to large companies which can rely on stocks and bonds in addition to banks.  Furthermore, banks are more secure in lending to larger businesses as it is a safer investment.

Small businesses employ over half of the private sector, and many are having difficulty obtaining additional capital from their banks.

For the original New York Times article