Lending is Up, But Not to Small Businesses

CHICAGO (TheStreet) -- These days, economic experts are looking for good news wherever they can get it. So a recent report from the Federal Reserve that shows a slight easing in bank lending could be hailed as a sign the year is off to promising start.

Check out the small print, however, and the story isn't quite so rosy -- especially for small businesses.

There are reports of more bank lending, but check out the small print and the story isn't quite so rosy, especially for small businesses.

For one thing, the most recent Senior Loan Officer Opinion Survey makes clear that most banks aren't easing up on commercial lending; the majority are keeping the same stringent standards they've applied since the financial crisis unfolded.

And those that are doing more lending clearly think bigger is better. Almost 20% of large banks surveyed had eased their credit standards for commercial and industrial loans to large and middle-market firms. But only 10% had eased standards for small businesses (those with $50 million or less in annual sales).

David Gass, founder of Business Credit Services, which offers credit building programs and other services to small businesses, says loans can be had -- but only for the top performers.

"Lenders are lowering their risk by lending only to qualified businesses, which makes sense when you see what they went through with the subprime mortgage crisis," he says. "Traditional banks still have very strict guidelines and not many new programs to help the small business startup. However, they do have programs if you have a great FICO score and have been in business for two years or more with financials showing revenue and profits."