NEW YORK ( TheStreet) -- What's happening in small business today? 1. Amazon gets into commercial lending.Amazon ( AMZN) is selectively offering loans to merchants that sell on its website through its one-year-old venture, Amazon Lending. The company is looking to help sellers obtain cash quickly when they're rejected by a bank or other lender through its subsidiary, Amazon Capital Services, according to The Wall Street Journal. Merchants who spoke with the Journal say they were offered loans ranging from $1,000 to $38,000. Interest rates ranged from less than 1% (for one merchant) to 13.9% compared to small-business credit card rates between 13% and 19%. The merchants also considered themselves "heavy sellers" of goods through Amazon, according to the article. The company is considering offering the lending platform to third-party sellers based outside the U.S. as well, the article says. Other sellers through Amazon question the company's motives for the lending option. Some don't want to give the online retailer even more control over their goods than they already have. Others don't want to be restricted in selling elsewhere if they got a loan through Amazon. Of course, Amazon stands to benefit from these loans. It collects between 6% and 15% commission on many sales made through its website. If the lending program helps sellers bring in more sales, that means more commission revenue in addition to the loan interest, the article points out. 2. Big bank lending increases in September. According to the latest Biz2Credit Small Business Lending Index, last month large banks (those with more than $10 billion in assets) approved 14.2% of funding requests by small companies, a 30% jump from the prior month. The figure represents the highest approval rating percentage for big banks since Biz2Credit began the index in 2011. The index compiles a monthly analysis of 1,000 loan applications on Biz2Credit.com "Lenders including Citibank, Sovereign and Citizens Bank are jumping head-first back into small-business lending. The economy seems to be improving slowly, and the improvement has been a factor in their willingness to lend to small businesses," according to a statement by Rohit Arora, Biz2Credit co-founder and CEO, who oversaw the research. "This is a good sign for the economy. Combined with surprisingly good September jobs report, the positive economic news comes just as President Obama tries to recover from his poor debate performance against Mitt Romney."
On the other hand, loan request approvals by small banks dipped to 47.6% from 47.8% in August. The loan approval rate by credit unions dropped for the fourth consecutive month in September to 52.4% from 52.9% in August. The September figure represented the lowest credit union approval rate since June 2011, Biz2Credit says. Approval rates by alternative lenders, which includes accounts receivable financers, merchant cash advance lenders, Community Development Financial Institutions (CDFI), micro lenders and others rose slightly to 64.6%, up from 64.5% in August. "Alternative lenders offer greater flexibility, quicker approvals, and competitive lending rates than they ever have before. This type of financing is very helpful for small and mid-size businesses that encounter short-term cash flow issues," Arora said. "Restaurants and retailers, in particular, find this type of financing attractive as they look to the fourth quarter to be profitable than other parts of the year. Many businesses are seeking short-term working capital to prepare for the upcoming holiday season." Biz2Credit, started by two Indian immigrants in 2007 to focus on the financial needs of Indian and South Asia immigrant business owners, has become very much a mainstream platform. Through the company, roughly $700 million in financing has reached thousands of businesses, including doctors, lawyers, franchise owners, gas station owners, restaurateurs and others. 3. Why Philly will never be a startup hub. Gene Marks, president of Marks Consulting and a Philadelphia resident, makes his case in The Philly Post for why the city will never be a tech startup hub. For the record, it's not because the city isn't trying, but Marks says that the city just doesn't have the personality to cater to the fanatic entrepreneur. "Start-ups that change the world and create billions of dollars of wealth are created by young, hyper, edgy, manic geniuses who stay up all night hacking into computers at the Department of Defense, or developing new drugs to make themselves even more hyper and manic. These people want to flock to a city with the same personality and be around others with the same personality. They find them in New York and San Francisco. And then the money finds them. Philadelphia is not a city like that," he writes. "We are a city where people settle to raise their kids, go to soccer games or catch a movie." -- Written by Laurie Kulikowski in New York. Follow @LKulikowski To contact Laurie Kulikowski, send an email to: Laurie.Kulikowski@thestreet.com. >To submit a news tip, email: firstname.lastname@example.org.