Banks may be missing an opportunity with women-owned businesses.

The Washington-based National Association of Women Business Owners surveyed its members about their banking relationships and found that two out of three reported problems with their lenders.

While many of these problems reported in the survey were common for both men and women, the survey pointed out that women face problems that their male counterparts do not. First, lenders often insist on having a spouse co-sign a loan for the woman entrepreneur. And second, these businesses felt rejected because they were owned by a woman. "Many women business owners come away thinking they are not being treated like a real person," said Virginia Kirkpatrick, president of a St. Louis management consultancy and a director of NAWBO. "That's because nobody wants to treat them the same way they might treat a man with the same issues and problems."

She understands the relationship from both sides. For 13 years, Ms. Kirkpatrick worked with St. Louis-based Mark Twain Bank, reaching the position of vice president of human resources. In 1984, she started her small business and today serves on the board of Allegiant Bank, a $107 million asset bank in St. Louis, where she sits on the loan and executive committees.

While she is not typical because of her banking experience, Ms. Kirkpatrick said two or three daily phone calls from other women business owners leads her to believe that the problems are serious enough to hurt the economy and cost banks valuable opportunities.

Ms. Kirkpatrick recently spoke about these concerns. Q.: What do you see as the most pressing financing problem facing women- owned businesses today? KIRKPATRICK: The biggest problem facing women business owners is that, almost without exception, they start out undercapitalized. If they grow, it's by using their own earnings and using credit cards. That creates a situation where women-owned businesses are not as creditworthy or as capable of borrowing large sums of money as other companies. Q.: But this is a problem with any small business. Is there something about women-owned businesses that makes them more prone to this problem? KIRKPATRICK: I certainly think one of the problems is that a large number of women-owned businesses are in the service industry. Whether these companies are owned by a woman or a man, they have more problems getting long-term loans than companies that are capital intensive with expensive equipment and buildings. Q.: How do women-owned businesses say they are treated differently by lenders? KIRKPATRICK: There is definitely a perception on the part of women business owners that they are not treated the same as men when they go to the bank. For example, there is the perception that if they took their husband along for an interview for a loan, or maybe a company vice president who was a male, that it would make a difference. Other common experiences I hear from women business owners is that bankers "talk down to me," or, "They act like I don't know what I'm doing." Q.: What can be done to change these attitudes? KIRKPATRICK: I really believe banks can be helpful by giving their loan officers training. My hope is that loan officers would be helpful to these entrepreneurs and not just discredit the business owner because they might not have their act together or because they didn't have a very good idea. Q.: Are banks giving their male customers more direction on what it takes to qualify for loans? KIRKPATRICK: I know they do that for businesses owned by men, because I'm sitting on a (bank) loan committee. They say if you want to qualify for a loan, you're going to need to get audited financial statements. You're going to need to show a profit for some period of time. I know that kind of advice goes out. It doesn't go out to women as much. I realize how that sounds. But from listening to the stories of women business owners, and sitting on a loan committee and knowing how loans are looked at, I think there could be some changes in the way banks approach lending to women. Q.: If women are not going to their banks for capital, where do experienced women-owned businesses turn for capital? KIRKPATRICK: To a greater extent than men, they use credit cards and pay very high interest. They also use personal savings and finance the growth through the earnings of the company, causing them to grow at a much slower pace. Women also depend much more on friends and family. And I think that is one of the reasons a large portion of woman-owned businesses are undercapitalized. It is hard to get $250,000 or $300,000 from friends. Q.: What about the SBA's new preapproved loan program? KIRKPATRICK: I know on a local level that those loans are not any more available than any other loan. When you say you've created a prequalified loan for women-owned business owners, you ought to also say, "for those who qualify." Q.: The SBA's concern was that some women-owned businesses who were qualified were not accepted. Has this happened to anyone you know? KIRKPATRICK: No, I have not. But the people I talked to that got a prequalified loan would have also qualified for 7(a) loan or a bank loan. If the purpose of it was to make sure women weren't discriminated against, then I think that should have been made clear. Because I think a lot of women heard it was an opportunity to be able to qualify more readily or easily, and that was not the case.

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