Sorry America, But 10 Million Businesses That Can’t Get Loans Isn’t “Normal”
So, word on the street is 90 percent of economic forecasters report that the recession will come to a grinding halt by the close of 2009. That’s good news for consumers, business owners, and ACCION USA’s microentrepreneurs—the group most dear to this blogger’s heart.
For American microbusinesses, the glass has always been half empty
But frankly, these were not the first thoughts that crossed my mind when I heard the news. My immediate reaction was one of panic–with the economic gloom almost over, what am I going to have to blog about? Credit will be more plentiful, increased consumer spending will mean less of a struggle for ACCION USA’s clients, and things will go back to normal—all boring topics, in my glass-is-half-empty opinion.
But “back to normal” is the catch. I had to remind myself that even before the recession hit, a significant segment of businesses lacked access to sufficient capital for reasons that had nothing to do with the credit crisis. Small loan requests, insufficient credit histories, and short lengths of time in business have always been challenges for microentrepreneurs.
According to my favorite statistical source, AEO, there were over 10 million small business owners that could not access small business loans even before the economic crisis. If that continues to be the norm, our nation’s small businesses are still in it for the long haul.
So, the moral of my story is that recession or not, business owners still lack capital and I’ll rest easy knowing that I’ll still have sufficient microfinance blog fodder. I hope that one day, neither will be true.