Feb 07 2020 21 mins
The fifth annual State of Latino Entrepreneurship report says that Latinos are launching businesses at an unprecedented pace, but barriers — some long-standing, some brand new — keep them from reaching their potential. One of those barriers is: - Latino-owned businesses experience funding shortfalls from traditional small business lending sources. “I need access to capital.” – Debt is not capital. Capital is the difference between what you own, your assets, and what you owe, your liabilities. FACT: Lenders love their money more than they love your business. As business loan performance drops off, U.S. banks are anticipated to rein in criteria this year, a Federal Reserve (Fed) survey showed on Monday (Feb. 3, 2020). Banks that reported expecting to tighten standards for any loan category were additionally asked to assess the importance of several potential reasons for the expected tightening: (1) capital or liquidity position, (2) collateral values, (3) competition from other bank or nonbank lenders, (4) risk tolerance, (5) ease of selling loans in secondary market, (6) credit quality of loan portfolio, and (7) concern about the effects of legislative or regulatory changes. Be Prepared, don’t be personally liable for your business debt: + Build Business Credibility + Business assets and collaterals + Build Business Credit (Net 30 accounts, revolving credit cards, etc.) If we don’t contribute something to the economic empowerment of the Latino business community through a robust and comprehensive approach, our economy will be negatively impacted, specially in those areas with a high concentration of Latinos.