Small Business Loans Lose Their Stigma
It’s a good time to be in the market for a small business loan. Interest rates remain low and small banks and non-banks are lending again. At the same time, the stigma associated with borrowing is fading. A new survey commissioned by PayPal found one in three business owners plan to borrow money in the next year. What’s more, 44% are more likely to take out a business loan now than prior to the pandemic. The reasons for borrowing vary, but many small business owners need the funding to take advantage of strong demand in the market. They are also shunning banks in favor of alternative lenders which promise fast funding and little in the way of paperwork. In this video, Donna Fuscaldo, a senior finance writer at business.com, interviews Bernardo Martinez, VP of global merchant lending at PayPal, about the payment company’s recent lending survey and why the stigma associated with borrowing is fading post-pandemic.
Time Stamps
0:00 Donna Fuscaldo of business.com introduces Bernardo Martinez of PayPal.
1:19 The pandemic forced business owners to embrace new strategies which are now paying off, requiring more capital to grow.
2:36 Small business owners are seeking out loans to invest in online marketing, to build their online presence, and expand into new marketplaces, Martinez explains.
4:10 Banks are losing their luster among small business borrowers because the loans require a lot of paperwork and approval can take time, which many small business owners don’t have.
7:00 Fuscaldo asks Martinez to explain the different loan types offered by alternative lenders.
8:48 Younger generations are more inclined to borrow money than their older counterparts because they are embracing new businesses online at a faster rate, which requires capital.
12:40 Small business owners are the key driver for the economy, employing half of the employees in the US, explains Martinez.
14:02 PayPal is willing to extend working capital loans to customers that have transacted with the payment processor for as little as four months.
15:09 Fuscaldo thanks Martinez for chatting with business.com.
Many small business owners are coming out of the pandemic in a stronger position. Pandemic stimulus helped them survive and thrive as they pay down debt and grow their operations. That is making it easier for business owners to get approved for a small business loan. In this video, Donna Fuscaldo of business.com interviews Bernardo Martinez of PayPal about the small business lending environment and why small business owners are more interested in borrowing money than prior to the pandemic.
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