Commercial finance lending is presently available from a small number of commercial banks. Most business lenders however are not among the small group of large banks, from which bailout funds are received. Small scale proprietors ought to familiarize themselves with the commercial lenders that are still offering commercial finance lending.
Mostly, the loans for this form of commercial funding are working capital loans to businesses, which are prompt in their debt repayments, and are portraying net profits, based on current financial reports. If these requirements are met, new business loans are easily obtained to finance credit lines and loans, which may have been recalled or cancelled by lenders. For other businesses not meeting these requirements, there are other sources of funding like commercial cash advance plans. A good number of small businesses rely on personal credit lines to finance some of the business operations.
There have been reports of annulment and decline in the number of such alternative loan programs, particularly the ones involving lenders who have received cash infusion from taxpayer funds, initially intended to facilitate lending to companies and end users. Personal and commercial credit lines have been done away with in many cases by lenders, as a result of a condensed ability to pay by borrowers, and weakening business situations. A huge proportion of borrowers, however, had a great repayment history for many of the reduced and cancelled credit lines.
In the meantime, there are banks that are willing to offer working capital loans. The most notable ones are banks that did not receive bailout funds. Generally, such commercial lenders are willing to provide capital finances either in form of new commercial financing, or by refinancing recalled or cancelled credit lines and term loans.
Given that it basically seems that bailout funds were given to lenders with a history of bad loans, the lending activities highlighted above are a real concern to many. Up to this point, little attention has been given to lenders with good balance sheets, in attempts by the government to channel more finances to the hands of consumers and commercial enterprises.
In summary, commercial finance lending was faced with major challenges in the face of the recent recession. This affected the established systems of commercial financial lending, and subsequently led to adjustments paving way for new commercial finance lending structures. Due to the economic downturn, there was a drastic decline in this particular type of lending.