As inflation hits high street, fintech group sees surge in loan applications

0

NEW YORK, March 10, 2022 /PRNewswire/ — Iron Capital Equities, which owns Line of Credit Depot (lineofcreditdepot.com), sees more local businesses may need bank debt financing. Iron Capital Equities found that the increase in loan applications soared 67% over the past 90 days. Business capital needs are high due to inflation, supply chain issues and rising wages.

Since the SBA EIDL loan program, part of Covid financial relief, ended for good, businesses will turn to bank loans and lines of credit. About the “use of funds”, companies are general in their reason, “working capital”. This could mean that the funds will be used for reserve cash and to pay for higher costs of goods and services.

“We are seeing a huge increase in loan applications from business owners, with most applicants having never sought business credit in the past,” says Matthew Elling, CEO of Iron Capital Equities. “The struggle to find affordable credit for small businesses is real. Many online lenders have higher than expected fees, so businesses come to us for lines of credit, which are issued by local banks and small business-friendly policies.”

This increase in small business credit needs has been demonstrated elsewhere, such as by the United States Chamber of Commerce and Goldman Sachs. In a recent US Chamber of Commerce survey, 45% of business owners took out a loan to manage higher costs caused by inflation. A Goldman Sachs survey recently found that 48% of small business owners who said inflation was their top concern had less than three months of cash reserves.

As inflation rises, the higher-than-expected costs of consumer goods and services could be further exacerbated by the developing conflict between Russia and Ukraine. Although companies usually pass on price increases to customers, the company still has to pay more on its end, hence the need for more working capital.

Contact:
Matthew Elling
(646) 808-3205
[email protected]

SOURCE Iron Capital Actions

Share.

Comments are closed.