Small businesses present opportunities to serve your community

Does your credit union shy away from offering commercial lending and business memberships? You wouldn’t be alone, but you might be missing out on opportunities to better serve your community.

Contrary to what might be popular belief, COVID wasn’t a death knell for small businesses. Yes, many struggled to weather the storm, but others found opportunities to adapt and grow, or to kick off a new business. According to data from the U.S. Census Bureau, more than four million business applications were filed in 2020, up 24 percent from the year prior, and 51 percent greater than the 2010-2019 average.

But this isn’t merely a byproduct of the pandemic. Small business applications continue increase, including a record 5.5 million applications in 2023. So with small businesses on the rise, where have credit unions fit in?

According to The Financial Brand, commercial loans outstanding at credit unions increased by 24.5% in 2022, double the growth rate reported by banks, greater even than credit unions’ overall loan growth that year. That said, credit unions’ total market share in commercial real estate, while slowly increasing, was still only 3.1% as of year end 2023.

 

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