scholarly journals Does the Community Reinvestment Act Increase Small Business Lending in Lower Income Neighborhoods?

2021 ◽  
Author(s):  
Mee Jung Kim ◽  
Kyung Min Lee ◽  
John S. Earle
Keyword(s):  
Small Business ◽  
Community Reinvestment Act ◽  
Lower Income ◽  
Small Business Lending ◽  
Community Reinvestment

Local Concentration in the Small Business Lending Market and Its Relationship to the Deposit Market

FEDS Notes ◽  
2021 ◽  
Vol 2021 (2972) ◽  
Author(s):  
Ken Onishi ◽  
Keyword(s):  
Small Business ◽  
Deposit Insurance ◽  
Product Market ◽  
Commercial Banking ◽  
Local Concentration ◽  
Small Business Lending ◽  
Community Reinvestment ◽  
The Supreme Court ◽  
Using Data ◽  
Federal Deposit Insurance

This note analyzes competition and concentration in the small business lending market using data obtained from Community Reinvestment Act (CRA) disclosures and data on local branches from the Federal Deposit Insurance Corporation's (FDIC) Summary of Deposits (SOD). In 1963, the Supreme Court defined the product market for commercial banking.

scholarly journals Is Lending Distance Really Changing? Distance Dynamics and Loan Composition in Small Business Lending

2021 ◽  
Vol 2021 (009) ◽  
pp. 1-43
Author(s):  
Robert M. Adams ◽  
◽  
Kenneth P. Brevoort ◽  
John C. Driscoll ◽  
◽  
...  
Keyword(s):  
Information Technology ◽  
Small Business ◽  
Small Group ◽  
Small Businesses ◽  
Average Distance ◽  
High Volume ◽  
Small Business Lending ◽  
Access To Credit ◽  
Community Reinvestment ◽  
Percentage Points

Has information technology improved small businesses' access to credit by hardening the information used in loan underwriting and reducing the importance of proximity to lenders? Previous research, pointing to increasing average lending distances, suggests that it has. But this conclusion can obscure differences across loans and lenders. Using over 20 years of Community Reinvestment Act data on small business lending, we find that while average distances have increased substantially, distances at individual banks remain unchanged. Instead, average distance has increased because a small group of lenders specializing in high-volume, small-loan lending nationwide have increased their share of small business lending by 10 percentage points. Our findings imply that small businesses continue to depend on local banks.

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