An ongoing challenge that business owners face is getting the funds they need to start and grow their businesses. While proactively helping your clients get loans and lines of credit is beneficial for both you and them, in reality, it can be challenging for many businesses to meet traditional lending criteria.
When that happens, you’ll want to be sure that you’re connecting your client with a funding source that can provide the funds they need.
In this article, we’ll share how referrals help you keep and grow your small business clients. As a result, you’ll build loyalty and goodwill, and keep your relationship strong for years to come.
Small businesses are critical to economic growth
According to the U.S. Small Business Administration (SBA), “Small businesses are the lifeblood of the U.S. economy: they create two-thirds of net new jobs and drive U.S. innovation and competitiveness. A new report shows that they account for 44 percent of U.S. economic activity.” That translates to nearly $6 trillion in small business gross domestic product (GDP) as of 2014.
That’s a significant amount of money flowing through small businesses! Yet, despite the impressive figures, the SBA reported an overall slight decline in small business growth.
A key reason for the decline is that businesses still find it difficult to obtain the funds they need for strong launches and smart growth. When that happens, many owners either throw in the towel or take on higher-risk loans from alternative lenders, which often puts them into financial distress.
Referring them to us is a good solution for you and your clients.
How we work with you and your clients
As a non-deposit institution that focuses on lending and advisory services, we don’t compete for your small business banking clients. Instead, we work with you to help you retain them. We achieve this by offering products with broader approval criteria to get your clients the financing they need, while retaining their business-banking relationships with you.
So, when you have small business clients that don’t meet your lending criteria (whether by a near-miss or more), let us know. We can provide:
- Loan options with flexible lending criteria for credit scores, collateral and more
- Opportunities for small businesses that are considered higher-risk, such as startups and certain industries
- Educational opportunities that help business owners learn the ins-and-outs of successful business management, from creating accurate financials to leveraging low-cost and high-impact marketing opportunities
- Mentoring and other resources that help entrepreneurs learn to run successful companies and prepare them for traditional loans from your institution
Working together to benefit you and your clients
Our capacity-building services provide your small business clients with the technical assistance they need to reduce the challenges they face as they grow their businesses:
1. Build and cultivate trust with your clients
When small business clients aren’t able to qualify for loans, they don’t always understand the nuances of the “why.” Instead, they only hear “no.”
When that happens, don’t let them walk away, move their deposits to a competitor or take on a high-risk lender. Instead, offer viable alternatives that show how much you value them. By providing solutions when they need them most, you’ll create loyalty and solidify your role as a trusted advisor.
2. Maintain and deepen existing banking relationships
When you partner with us, your clients keep their banking relationships with you:
- We’ll work with you to help your business clients get loans with affordable repayment terms. This will allow them stabilize their finances and invest in growth, helping to improve their credit profiles over time.
- The loans we provide are deposited into the business accounts that your clients have with you, growing their account balances and strengthening your small business banking portfolio.
- They receive critical financing capital and when their businesses grow, both their revenues and deposits with your institution can also increase.
- When you retain your business clients, you gain additional cross-selling opportunities that you can leverage for additional growth across your institution’s offerings.
3. Create a pipeline for future sales
Clients are often referred to us when they show great potential but just fall short of their banks’ lending criteria. Our loans provide businesses with the financing they need to increase revenues, improve credit scores and prepare for later business funding through your institution.
And every year, we review our lending portfolio to find those clients who may be ready for bank financing and we provide you with our recommendations, bringing your clients right back to you.
Contact us today to learn more about all the ways we can help you and your clients
We’ve helped dozens of banks and other financial institutions strengthen their small business portfolios and support entrepreneurship in their communities. We help businesses obtain the financing they need at critical points: before the owners can meet typical lending criteria, while their businesses are in early stages or when they have an immediate financing need. Try our two-minute prescreen tool to see if we can offer an automatic loan approval for your client.
Our team is available to answer your questions and suggest ways to work together. We look forward to helping you and your small business clients.
