The Federal Reserve reported that small loans to businesses have grown rapidly in the the post-recession period, according to a Report to the Congress on the Availability of Credit to Small Businesses.
Between 2012 and 2016, outstanding business loans at credit unions increased by 53.4 percent. In comparison, small loans to businesses by commercial banks increased only 1.4 percent.
Despite this growth, outstanding small business loans at credit unions remain a small fraction of the total small business lending marketplace.
The report notes that aggregate credit union business lending is capped at 12.25 percent of assets.
As of June 2016, 5.6 percent of credit unions had outstanding loans to businesses totaling in excess of 80 percent of their cap. However, among credit unions with assets of more than $1 billion, 23.2 percent had outstanding loans to business in excess of 80 percent of their cap.
The report states that raising the cap has the potential to accelerate the rate of small business lending by credit unions.
The report was issued in September 2017.
Read the Report.
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