Bank of America is calling recent reports that it is cutting or closing the credit lines for all of its small business clients “speculation.”
The Charlotte, N.C.-based bank said it has put in a maturity date and annual renewal process in lines of credit, which are considered standard practices.
“These changes were explained in letters to affected customers at least one year in advance of the new maturity date,” said Jefferson George, a BofA spokesperson. “This allowed time for us to work with all affected clients to explore other products available to best meet their business needs.”
George told Credit Union Times the bank has been able to work with 98% of the clients in the affected group “and at this point the overwhelming majority of those solutions involve the same interest rate as before.”
The number of customers who have not renewed their lines of credit or agreed to another credit solution was about 0.1% of BofA’s nearly 1.5 million total small business credit customers, George said.
“The reality is that nearly all of the customers who were sent these notifications remain with Bank of America, and the number of customers with whom we’re still working to find a solution is very small,” George said. “…contrary to any speculation, we are not cutting or closing credit lines for our small business clients across the board.”
Some small business owners complained the alternatives BofA has offered have not been helpful.