Wells Fargo has kicked off a major initiative to create $100 billion in new loans to small businesses nationwide by 2018.
Jim Malcolm, Wells Fargo’s northeast small business strategy director, said small businesses in New Jersey that want to grow their employee base are seeking out loans.
And as the economic recovery continues in the Garden State, the bank has found small firms are more often than not taking out loans for upgrades to their equipment and real estate investment opportunities.
“Right now one of the most important things we can do is grow the small business segment, not just for our bank but from the standpoint of the economy. This is where we are seeing a lot of growth and where we want to encourage growth and success among smaller businesses that are getting started,” Malcolm said.
The “Wells Fargo Works for Small Business” includes a new website dedicated to small business. It brings together the bank’s small business products and provides guidance on building credit and sustaining growth.
Malcolm said the website includes “the financial products we offer, services that fill a need or guidance we provide from industry experts on topics like cash flow or how to find customers. It’s really for anyone that’s interested in starting a small business” or growing an existing one.
In recent years, small businesses have reported that it’s been more difficult to secure a loan after suffering deficits during the recession.
The website also offers advice on “securing business credit if you’ve had a couple of bumps in the road from a credit standpoint and how to repair that,” Malcolm said. Wells Fargo, among other products, offers a secure line of credit for small businesses that are just getting started or ones that took a hit to their credit rating during the recession.
However, loan demand has not returned to prerecession levels.
“But demand is starting to pick up. We’re not seeing some of the big projects we saw in the past but businesses want to add employees and they are looking at expanding,” he said.
For the New Jersey firms that are seeking out upgraded equipment, like buying vehicles or new computers, they plan improve efficiency and to grow their sales by improving “the output or the efficiency of what they do,” Malcolm said.
Equipment financing “is an area where we see opportunity with options from leasing to buying,” he said.
Malcolm said Wells Fargo is also financing real estate purchases since the bank sees it as a tremendous opportunity to help investors.
Borrowers come from all aspects of the businesses world, including doctors purchasing buildings to house their medical practices and investors buying commercial properties to rent space to other tenants, he said.
Malcolm mainly tries to focus on firms with less than $2 million in sales, and with that comes a demand for commercial real estate financing under $500.000.
Wells Fargo was the leading Small Business Administration lender by dollar amount for each of the past five years. An SBA loan is a loan made by a bank or other lender for which repayment is partially guaranteed by the federal government.
The new wellsfargoworks.com site currently has a contest for small business owners. Five finalists will each win $25,000 along with mentorship and tailored solutions for their business, and a $5,000 charitable donation to a charity in their community. The contest runs from May 1 to June 30, and winners will be announced in September.
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