Technology and Small Business Lending: A Case Study

Abstract

Community banks are more able than their larger, more bureaucratic competitors to meet clients’ unique demands. This adaptability is evident in their growing market share in small business and agricultural lending, which often require distinctly structured loans. Community banks are active in the communities they serve and, therefore, have a deeper understanding of client needs. Smaller community banks do not have the vast resources to market and develop financial technologies often offered by their larger, bigbank competitors. The purpose of this paper is to determine how technology usage impacts small business lending and profitability at community banks.