By Randa Chris | NerdWallet

As the economy recovers and the United States emerges from the epidemic, small business owners need capital access to recover and grow. However, since federal relief from the Wage Protection Program expires on May 31, business owners can gain unsatisfactory PPP experience with an alternative lender, where to find finance or look for new options.

“You are number one in a large bank,” says Carson Laptito, president of the West Bank of Irvine, California. I have many clients who do this with PPP. I think as you go through.

The best source of funding is always based on the company’s specific needs, qualifications and industry and other factors. Here are four options to consider.

1. Regional and Community Banks

Small banks typically offer low interest rates, long term contracts and high loan rates, as well as personal attention and adjusted decision making. However, their technology has lagged behind other lenders. Lapito says that is a problem.

Lapitito: “The biggest change is the PPP. And the epidemic will advance banking, as well as bank customers, by five years. ”

For example, banks use Docusign – an electronic signature and agreement platform – in PPP. Within weeks as you go through the process.

However, small business loans are still difficult to qualify. Business owners need good loans and strong financing.

Also, although large and small banks will gradually increase loan approval levels in 2021, Biz2Credit’s Small Business Lending Index report shows that they are nowhere near the pre-epidemic levels: in February 2020, small banks approved 50.3% of small business loan applications. , Compared to 18.9% in June 2021.

2. Small business management

Although the PPP program is out of date, regular SBA loans, such as 7 (a) loans, continue to be strong financing options for small businesses. Like bank loans, SBA loans can be difficult to obtain, but they offer long-term contracts and reasonable interest rates.

To support small businesses and encourage lenders to invest capital in December 2020, SBA raised its guarantee on 7 (a) loans and abolished regular loan repayments. The move “has enabled creditors to be more active during this time,” says Boefly Mike Roseman, a financial marketer who specializes in franchise solutions.

And with the boom in the economy, Roseman believes more lenders will remain in the SBA loan market, although the increased guarantees expire on September 30.

3. Online lenders

Banks have made some progress on technology improvements, but online business loans can still come with faster application and financial experience. Although banks may offer lower interest rates than online lenders, business owners may be willing to pay a little more for a more efficient experience, according to Roseman.

The February 2021 report by S & P Global Market Intelligence predicts that Fintech’s loan will outperform epidemic levels over the next three years. Small and medium enterprises are expected to increase their loan portfolio by 16.2% annually, especially by 2024. Online lenders are also more likely to lend money to new businesses or to bad people. Fair credit.

4. Nonprofit Lenders and CDFIs

Nonprofit lenders and community development financial institutions or CDFs can be great sources of affordable finance, especially small loans. These missions are good alternatives, especially for non-women businesses and small business owners.

During the entire epidemic, non-profit organizations and CDFIs created low-interest loan programs to support the remaining business owners in the PPP program.

For example, Southern Opportunity and Resistance Fund provides loans up to $ 100,000 to help businesses survive the current crisis. But the goal of these initiatives is not just capital. Urutsius said these programs also provide support and coaching businesses to enable them to graduate into other disciplines.

Wherever you need financial support, Urutua advises caution. Evaluate resources such as the rights of small business borrowers and make sure any loan terms are clear.

“This is the time for hunters to come looking for you, and this is the time to spend some time doing your homework,” says Urutua.

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Randa Chris writes for NerdWallet. Email rkriss@nerdwallet.com.