Is Now a Good Time to Get Started with Credit Card Borrowing?
If you are an entrepreneur or a small business owner, one way in which you can avail finance to fund your operations or get your business off the ground is through credit card borrowing. One advantage with using credit cards is that it removes the need to get costly funding from investors. Moreover, you can draw down as much money as you require, as and when you want it, provided that it is within a certain limit.
According to the 19th annual “Survey of Credit Underwriting Practices” conducted by The Office of the Comptroller of the Currency (OCC), during the period ending June 30, 2013, credit cards were among the loan products that experienced the maximum easing of underwriting standards. The survey shows that during this time, 33 percent of the banks under examination eased lending protocols for credit cards, while 54 percent kept them unchanged.
Most banks relaxed underwriting standards through changes in credit lines, pricing and fees, scorecard cut-offs, debt-to-income ratios, and documentation requirements, making borrowing through the credit card route much simpler and cost effective than before. This trend is expected to continue, with more banks slated to increase their exposure to this product segment. The perception of risk towards this segment from the bank’s point of view has also stabilized, with the result that they are now willing to allocate a larger percentage of their loan portfolio towards credit card loans.
Small business owners have additional reasons to celebrate, as another segment in the loan portfolio of banks that has received a boost is the small business loans division. Since 2012, 79 percent of the banks under survey reported unchanged standards for this division, while 21 percent actually eased lending protocols. Moreover, with improved economic conditions, the level of small business credit risk at 81 percent of the banks surveyed has declined or remained the same.
Thus, in the current economic scenario, banks and federal institutions are eager to expand their business by offering credit cards and small business loans at highly competitive rates. If you have been looking for an opportunity to start or extend your business, but have been unable to do so due to lack of funds, now is your chance.
Do you want to learn how to become a savvy credit user and learn how to leverage zero interest credit for investing/business expenses?
CLICK HERE to Register NOW for a FREE Webinar
Article written by Ari Page, Business Funding Expert
Published to MonteFeSelfStorage.com with permission through Credit Card Builders Affiliate program
Ari Page is CEO of Credit Card Builders, a company that helps small businesses raise unsecured, zero percent business financing. A voracious reader, Ari constantly scours the market for new techniques and strategies to identify creative and profitable borrowing strategies. Because of his unique insight and approach, Credit Card Builders has raised millions in funding for small businesses nationwide, with the average amount ranging from between $50,000 and $250,000.
This is a program that Marsha Yearian and Alberto Bernardoni have personally participated in. It has been very beneficial in restoring and building both personal and business credit. Credit Card Builders works!
Marsha Yearian, CEO of Monte Fe Investments, Management & Consulting is an affiliate of Credit Card Builders. Affiliates may earn commissions from Credit Card Builder sales.