As everyone working in the franchising sector knows, even though the calendar has changed, the economic challenges haven’t gone away. Luckily, this fact hasn’t escaped the eyes of President Obama, who has spent some of the first week of the year lobbying America’s banks to accelerate their small business lending.
According to Entrepreneur magazine’s Diane Ransom, President Obama has asked that bankers give small businesses that had loan applications rejected this year "a third and fourth look" this year. They are strong words from the President and now the ball is firmly in the court of America’s big banks to do something about it.
Will they, though? The CEOs of Bancorp and PNC Bank, after meeting with the President, subsequently made pledges to reconsider rejected loans. And according to outgoing Bank of America president Ken Lewis: "Small and medium sized businesses are the lifeblood of the U.S. economy. Our improved financial condition and our optimism about the economy will allow us to step up lending to support these clients.” That statement is backed up by pledges of up to $5 billion to small banks, so at least Bank of America are putting their money where their mouth is.
But still the lending market remains stalled. We welcome the President’s lobbying on behalf of small business owners, but it is time for these hugely profitable banks to start to push some of their earnings back into the real economy and into the pockets of America's franchisees and small business owners.