ABFJ Podcast: The State of Small Business Lending - a podcast by ABF Journal

The economic recovery from the COVID-19 pandemic is only just beginning, but 

May was a slightly better month than April for small business borrowers, at least in terms of lending approval rates. 

In the 12th episode of ABF Journal’s COVID-19-focused podcast series, Rohit Arora, CEO of Biz2Credit, provided his perspective on small business lending during the first five months of 2020, including the drastic decline in April and the marginal increase in May. 

Arora explained that the supply is there and that lenders are looking to deploy capital, but that slowed demand has led to large decreases in lending. He outlined how the Paycheck Protection Program has been a “game changer” and how small businesses have quickly become accustomed to digital offerings, which will force a “paradigm shift” in the lending space. 

Arora warned that big banks and alternative lenders may struggle in the coming months while small banks find a bit more success. However, he advised all institutions to become nimble, cut fixed costs and invest in technology to ensure a quicker rebound, even if he doesn’t expect full recovery until 2021.

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