Small businesses in need of a loan find banks are stingy

By MAE ANDERSON
AP Business Writer

NEW YORK (AP) — Many small businesses are finding it tough to get a bank loan, making it difficult to move beyond the pandemic and afford the higher costs of goods and labor. A recently released survey from the Federal Reserve shows that 85% of small businesses experienced financial difficulties in 2021, up nearly 20 percentage points from 2019. Meanwhile, inflation is the highest in decades, with raw materials and finished goods soaring in price and workers demanding higher wages. Even in normal times, it can be tough for small businesses to get loans from traditional banks. During the pandemic, banks have been stingier, outside of COVID-related programs. Online loans are easier to get but often come with higher rates.