Community Banks Will Find a Big SMB Opportunity from the Crisis

The Paycheck Protection Program has highlighted a number of issues in small business banking that could potentially open the door for smaller bankers to better serve small businesses; a study conducted by Cornerstone Advisors and Auto-books found that small and medium-sized enterprises (SMEs) with $100,000 to $5 million in revenue, and who employ more than one person borrowed $1.9tn in the last two years; the number points to the significant shortfall in the funds allocated by Congress so far as the study also found the same companies expect to borrow $2.6tn over the next two years; 57 percent of companies with revenues up to $50mn consider a megabank, Chase, Bank of America and Wells Fargo, their primary bank and who they count of for their lending needs; with the significant amount of problems the PPP has seen there could end up being a big opportunity for smaller banks to offer a better small business banking relationship; Ron Shevlin of Cornerstone Advisors says to ensure they can hold these relationships they need to exhibit good digital tools for SMEs, an ongoing commitment to lend and the ability to help these companies better run their businesses. Forbes

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