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Expert Offers Explanation Why Small Businesses Have Trouble Getting Loans

BROAD AXE, Pa. (CBS) - A new survey finds small businesses looking to grow and expand are having a harder time finding lenders who will loan them money at reasonable interest rates.

The survey by MultiFunding in Broad Axe, Montgomery County found that collateral is the key for small businesses when it comes to interest. The survey found that equity and assets have moved ahead of credit and cash flow when a lender assesses a business's credibility. MultiFunding CEO Ami Kassar says those tighter restrictions could slow down any economic recovery.

"Small businesses are the key driver to any economic recovery and they have been historically, and in order to grow and in order to add jobs and buy equipment and build and develop new products or offer new services, small businesses need access to capital."

He says nearly fifty percent of the small business owners in the study pay a higher premium because they don't have the necessary collateral. MultiFunding works with businesses to help them find the right lenders.

Reported by Brad Segall, KYW Newsradio

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