Small company loans could very well start getting more affordable, and the U.S. unemployment rate might be affected. The nation’s second-largest bank announced that it will lower the rate of interest on small company lines of credit for companies that hire new employees. Small company lending has been a big issue as credit dried up while banks were bailed out by the government. Banks have resumed raking in billions when small business struggle and unemployment remains high. Pressure from the public might be beginning to have an effect on loosening credit.
Post resource: Chase cuts rate on small companies loans for companies that hire by Personal Money Store
Small companies and their hiring incentives
Small business hiring incentives from J.P. Morgan Chase and Co. consist of lowering its interest rate by 0.5 percent on a new business line of credit for each new employee hired, for up to three employees, for the life of the loan. It was reported by Zacks.com that J.P. Morgan may also provide discounts to small companies for opening checking accounts. In addition, J.P. Morgan plans to hold conferences in 11 cities across the country to help local and small company owners to improve their sales figures and fund their businesses.
Are businesses ready to hire with all of of the banks ready to loan?
During the economic downturn, politicians and also the public at large have scorned banks that received government assistance, yet refused to make small business loans to help reduce unemployment. The Wall Street Journal reports that bankers have offered the excuse that there’s not enough demand from credit-worthy borrowers. It also appears to be true that losses from small-business loans are severe at major small-business lenders. But Kevin Watters of J.P. Morgan Chase told the Journal the economic outlook among small company owners has improved and small companies are ready to expand and hire.
Small businesses have help offered by other banks
Small company loans are being made by numerous banks. J.P. Morgan stated that first-quarter loans to small companies rose 31 percent from a year earlier, to $ 2.1 billion. The nation’s largest bank, which is actually Bank of America, reported that small business loans rose 18 percent from a year earlier to $ 19.4 billion. Numerous banks, including those such as J.P. Morgan, U.S. Bancorp, PNC Financial Services Group Inc. and Capital One Financial Corp. are giving rejected small-business loans a second look. Two years ago U.S. Bankcorp began training 3,000 bank managers about small company lending.
Chase keeps its word on small company loans
The J.P. Morgan Chase offer to cut all of its interest rate for companies that hire new employees is accessible for business lines of credit up to $ 250,000. It was reported by MarketWatch that the offer is also accessible for existing customers who hire new employees to increase their lines of credit by $ 10,000 or more. Chase business checking customers are likely to receive an additional half percent discount on their loan rates for hiring new employees. This makes good the promise that JP Morgan Chase ended up making last year. The bank announced plans to try and increase its lending to small businesses by $ 4 billion in 2010 to a total of $ 10 billion through access to working capital, term loans for expansion, commercial mortgages, lines of credit and business credit cards. It said it would hire 325 more business bankers.
Discover a lot more information here:
zacks.com
zacks.com/stock/news/36284/JPMorgan+Motivates+Small+Businesses
TheWall Street Journal
online.wsj.com/article/BT-CO-20100629-713817.html
Marketwatch.com
marketwatch.com/story/hire-a-new-employee-chase-will-lower-the-interest-rate-on-your-business-loan-2010-06-30?reflink=MW_news_stmp
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