© Business Wire 2010
MotherFund, a leading provider of working capital and creative financial solutions for small businesses nationwide, reports record growth in applications requesting working capital for small businesses, because of the continuing stagnation in available credit.
Jason Bishop, MotherFund’s Chairman and CEO, said, “For more than 18 months now, small businesses, especially retailers, have seen lending and credit sources dry up and virtually disappear. Lenders are having a difficult time adjusting to this environment. MotherFund’s products are priced for risk, whereas traditional lending products cannot sustain if the portfolio performance slows down. The result is a decrease in the availability of traditional credit, making our working-capital options not only the cheapest money available, but often the only money available to entrepreneurs who see this as a time to grow.”
Bishop says a recent report in the Wall Street Journal suggests that bank credit for small businesses continues to shrink, not grow, and that in 2009, total lending by banks dropped at the steepest rate since 1942. “Small businesses can’t catch a break,” said Bishop, adding, “That same Journal report indicated that last month the Federal Reserve, the Federal Deposit Insurance Corp., and other state and federal agencies jointly urged banks to continue lending, but we don’t see it happening.”
MotherFund offers working capital financing to small businesses in the restaurant and retail sector, among others, through a variety of programs, such as its popular merchant cash advance. Several of MotherFund’s products are based on accounts receivable financing or factoring. This form of financing puts a company’s financial assets to work immediately.
MotherFund’s Bishop said, “Working capital is the lifeblood of small business, and without it, there will be no economic revival. Lenders are worried about lending because they think businesses may fail. But, without proper funding, businesses don’t have much of a chance, so for the lenders, this is a self-fulfilling argument. Our approach gives businesses a fighting chance.”
MotherFund is a Texas-based company that provides alternative financial products and services for small businesses. The Company is a leading provider of creative working capital solutions that allow businesses access to a consistently available source of money, for a variety of needs. These include seasonal merchandise, payroll, expansion, inventory, new equipment, and other requirements that keep the business growing.