Rising Interest Rates Lead To A Small Business Credit Crunch

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The Fed chair said that recent developments, such as the SVB collapse, are likely to result in tighter credit conditions for both households and businesses.

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Meanwhile, regional and community banks approved 21.3% of funding requests. While that number is greater than the figure of big banks, it pales in comparison to February 2020, when they approved more than half of applications. While raising interest rates is a historically successful tactic used to combat high inflation, the rising cost of capital is putting a squeeze on small business owners. Often,are variable rate loans, and continuously rising rates are increasing the among of their revenues that go towards debt service. Many small businesses are already experiencing cash flow issues.

 

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Move along nothing to see here in this shitshow called the Biden administration

Well, duhhhhh.

So let me get this straight : banks do risky shit with our money so they can make more money, and in response the regulators make it harder for poor people to get loans. OK that makes sense.

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