Underwriting Member Business Loans
Setting up your credit union's standards and guidelines
By Brian McLaughlin

The Credit Union Business Loan Memo
What information to include
By Brian McLaughlin

All Business
When it comes to member business services, marketers' roles span research, product design and delivery, and education.
By Karen Bankston

Small Business Loan Approvals Up at Big Banks

Small business loan approval rates at big banks ($10B+ in assets) in January 2013 increased to 15.3 percent, up from 14.9 percent in December 2012, according to the Biz2Credit Small Business Lending Index, a monthly analysis of 1,000 loan applications from small business owners applying for financing through Biz2Credit.com, which connects borrowers with more than 300 lenders nationwide.

The 15.3 percent approval rate at big banks is the highest recorded by the Biz2Credit Small Business Lending Index, first publicized in 2011, and marks a 31 percent increase over the January 2012 figure of 11.7 percent.

Credit union approvals of small business loans, however, slipped for the eighth consecutive month to 46.9 percent in January 2013 from 47.6 percent in December 2012. "Credit unions entered the market aggressively in late 2011 and early 2012, but since October they are rejecting more than half of the funding requests from small business owners," explains Rohit Arora, Biz2Credit co-founder and CEO. "Part of the problem is that the bill to raise the credit unions' cap on small business lending is stuck in the Senate.”

Technology also plays an important role, adds Arora. "Technology is changing the landscape of small business lending. Big banks are investing a lot of money in their online platforms and streamlining the loan application process. Small banks [and credit unions] need to do the same. [They] must upgrade their systems and allow online applications for small business loans. It's the only way to compete now that the big banks are moving aggressively in the marketplace."

Blog: Helping Business Owners: Fort Knox Federal Credit Union, Radcliff, Ky., offered small business owners a human resources seminar. Rita R. Johnson, PHR, training and development coordinator at the CU, shared the outline from the seminar in this CUES Skybox blog post.

Return on Business Services

By Karen Bankston

Note: This article first appeared in the March issue of CU Management.

Mark Weber of CUES Supplier member Weber Marketing Group, Seattle, identifies several benefits to offering business services:

• Bigger balances. The average balances of business checking and money market accounts are five to 10 times the typical balances maintained by consumers.

• More revenue. Small business loans, credit card accounts, and checking accounts typically generate more income than similar consumer services.

• Enhanced member relationships. “If you serve these members well, you will get both their personal accounts and their business accounts,” Weber notes. “When served well, they can be long-time, stable members.”

• New members. “By providing value-oriented services to business members’ employees, you have an opportunity to bank all those people,” he says.

Karen Bankston is the proprietor of Precision Prose, Stoughton, Wis.

Calendar

CUES School of Business Lending^™
School I: Business Lending Fundamentals
April 29-May 3
Embassy Suites, Downtown Chicago

CUES School of Business Lending^™
School II: Financial Analysis and Diagnostic Assessment
July 15-19
Hyatt Cambridge
Boston/Cambridge

CUES School of Business Lending™
School III: Strategic Business Lending
Sept. 9-13
Crowne Plaza Seattle Downtown