Navigating as a small business owner can be daunting, especially during a pandemic. But with a little insight and planning, businesses can chart a smart course through uncertain times.

Have lenders changed operations or lending procedures during the COVID-19 pandemic?

Certainly, some lenders are stepping back and scrutinizing their practices right now. Typically, when you see a volatile market, commercial lenders are the first to step back so they can watch and see what happens with the economy. They’re constricting lending practices and waiting to see the results of economic changes.

We see this with some national lenders. But, many local lenders aren’t pulling back. Rather, community-focused lenders are continuing to support the business community and help the local economy flourish. If a business checks the boxes on normal guidelines, local lenders are absolutely willing to lend to them.

The pandemic has changed the way many local businesses operate. Are lenders requiring different financial information considering this?

Many lenders are asking for insight into how the business has been maintaining through the pandemic. This includes year-to-date profit & loss information that’s updated within at least 90 days from the application date (i.e. an application in November would require 2020 P&L info through at least August). We want to see what COVID-19 has done to the business and how the owner is coping with the changes.

What should business owners look for in a potential lender right now?

Business banking is all about finding a good partner. A business banker shouldn’t just help a business owner open their account or get a loan. They should communicate the business owner frequently to have a good idea of how they’re running. Plus, they should keep updated financial information from the business and review it regularly. They can then compare this information to industry benchmarks and help the business owner on how to operate with greater financial efficiency. Your relationship with your business banker can mean the difference between average performance or above average growth. FBN

By Ian Cribbs

Ian Cribbs is VP of Business Banking and Services for OneAZ Credit Union. OneAZ offers a full suite of business banking solutions for Arizonans, from checking and savings to credit cards and loans. They work with over 7,000 Arizona businesses of all sizes and are committed to supporting the local economy. Learn more at OneAZcu.com/Business.