Current economic factors could significantly affect your ability to get funding from traditional lenders. Recent bank failures, along with rising Federal Reserve interest rates, are making it difficult for many individuals to get lending. Banks are raising lending standards, but alternative options exist to get the equipment you need for your business. Here is everything you need to know about how tightened bank lending may affect equipment financing for your business.
Banking System Stability
Rushes in withdrawals have led to the collapse of certain banks, like the recent closures of the Silicon Valley Bank and Signature Bank institutions. As a result, many banks are becoming more cautious and creating tightened bank lending restrictions. This means business owners with excellent credit could be denied equipment financing in the future.
Dollar Dominance Concerns
Some economists predict a mild recession later this year due to concerns about the dollar’s dominance as a currency. Financial sanctions and export controls with Russia, China and Iran could erode the dominance of the U.S. dollar. This could further tighten bank lending for business owners seeking equipment financing.
Slowing Manufacturing Output
According to recent economic data, manufacturing output is losing momentum. If this decline continues, the Federal Reserve may raise interest rates to around five percent or higher. These rates would be the highest since 2007 when the global financial crisis began. Unless a solution is developed soon, this could exacerbate tightened bank lending with equipment financing for small business owners and equipment dealers.
Avoid Tightened Bank Lending with Stress-Free Equipment Financing
If you struggle to get business equipment because of tightened bank lending restrictions, there are excellent alternatives to get the funding you need. At MidPoint Equipment Finance, you can receive stress-free equipment financing with fair rates and flexible payment scenarios. Call to apply for financing today.
