Big Banks Interested to Lend to Small Businesses

The activities of Obama’s administration have started to give positive results. This has made a great impact on the Big Banks to lend credit to small businesses. Especially, the pressure on banks is changing the mind set of Big banks. Today, big banks are interested in lending to small businesses. Big banks like Bank of America Corp., Goldman Sachs Inc., Citigroup Inc. have independently announced programs for lending to small businesses.

Goldman Sachs is an investment bank which does not lend directly to entrepreneurs, but it is currently planning to lend $300 million called CDFIs (Community Development Financial Institutions) to small businesses in low income communities. It is also planning to lend $200 million to community colleges and business education programs in other organizations.

$200 million investment on CDFIs were announced by Citigroup. Under the CDFI program, CDFIs can request for 5 year credit from Citi. It is just to increase lending to qualifying small firms.

Bank of American in may invested $19.4 billion during the first quarter which is up $3 billion when compared with last year. It has lend more than $22 billion in the next 3 quarters in order to meet its goal.