When it comes to where they plan to go to for financing over thenext six months, some small businesses said banks will likely betheir first choice over credit unions and business creditcards.

That's according to a June survey of 6,000 business owners fromPepperdine University's Graziadio School of Business andManagement, conducted in partnership with Dun & BradstreetCredibility Corp.

Sixty-eight percent of those seeking financing in the next sixmonths said they will pursue a bank loan as a likely source offinancing followed by 40% who said they will use a business creditcard and 36% who will look at a credit union or communitydevelopment financial institutions, the data showed.

Business owners with revenue between $5 million and $100 millionwere more optimistic about successfully raising financing frombanks than businesses with revenues under $5 million, the surveynoted.

While 67% of respondents were unsuccessful in securing a bankloan, they said the general category of financing is a still a goodfit for their business, according to the survey.

Bank loans, in many ways, are a bellwether of the economy'sstrength, said John Paglia, director of the Pepperdine PrivateCapital Markets Project and associate professor of finance atPepperdine University's Graziadio School of Business andManagement.

“As business owners secure more traditional sources of financingand rely less on their own personal resources, they will have morediscretionary money to spend thereby stimulating our economy,” hesaid in a statement.

One of Paglia's colleagues, David M. Smith, recently authored areport for the Filene Research Institute that showed credit unions were betterat withstanding recessions compared to banks when it came tocommercial lending.

Smith is an associate professor of economics and associate deanof academic affairs at the Graziadio School of Business andManagement at Pepperdine.

Commercialloan growth rates for banks turned negative following therecessions beginning in 2001 and 2007, but credit union growthrates remained positive during both periods, according to Smith'sanalysis.

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