Entrepreneurial

When the financial crisis hit, panicked small businesses were scrambling to find credit. Nearly three years later it’s a much different story.

The level of credit shopping – when a borrower seeks a loan or lease from more than one lender – by small businesses has fallen nearly 30 percent since September 2008, according to new data released by PayNet Inc and it may lead lenders to offer better terms said William Phelan, PayNet’s president and founder.

“It indicates that it’s not a very competitive market right now,” said Phelan, whose Skokie, Illinois-based company released the data as part of the launch of its new Credit Shopping Indicator, which measures the number of lenders a borrower shops for business credit. “In 2008 you would have expected it to be high because of the recession and the lack of availability of credit.”

Phelan said back then the indicator registered 118 – a record – and far above pre-recessionary levels in January 2005, when it sat at 100 – the point at which a borrower typically shops for credit at more than one bank. Today it stands at 84.

This dip is actually good news for small businesses, who should take the opportunity to ask for better loan terms from lenders, said Phelan.

Large banks are making noise about lending more to small companies this year, but financing expert Ami Kassar is still advising his clients to steer clear.

The founder of Philadelphia-based MultiFunding LLC, which brokers loans for small businesses, said his customers stand a better shot at success with regional and community banks.

“As a general rule we don’t get near big banks,” said Kassar, whose firm has arranged 28 deals since launching 15 months ago and has more than 60 others in the pipeline. “The big banks are, in my opinion, full of big talk in terms of their commitment to small business.”

– Mary Goodman and Rich Russakoff are co-founders of Bottom Line Up Enterprises. This article originally appeared on The Money Dept. column for BNET. The views expressed are their own. –

Finding the right bank for your business is not all that different from finding the right mechanic for your car, or the right surgeon for an operation. You need some objective information first.

The best way to determine whether or not to consider a particular bank is to find out the answers to the following 10 questions. Use them as your starting point, but know that you should dig deeper if you can.

– Jeff Stibel is the chairman and CEO of small business credit rating agency Dun & Bradstreet Credibility Corp. The views expressed are his own. –

The “Great Recession” – the longest since World War Two – will have an even more prolonged effect on the economy if one trend continues: small businesses are unable to secure capital.

Despite significant government stimulus to banks and lending institutions, small business lending is actually down over the past few years. So why isn’t the banking industry lending to small businesses during a period in our history when it’s absolutely essential? The answer has a lot to do with credit-worthiness.

A new study showed the big U.S. banks have some work to do to if they want to improve their image among small and mid-sized businesses.

The annual report, released by Portfolio.com and based on research conducted by American City Business Journals (ACBJ), surveyed 1,762 business owners, CEOs and presidents of companies with more than one employee and asked them to rank 207 brand-name companies, from the technology, telecom, travel, financial and media sectors, on a set of seven different attributes.

Among banks and financial services firms trust remained the biggest issue for the small business owners polled, said Godfrey Phillips, vice president for research at ACBJ.