Ethics and moral considerations have gained prominence in the business world, particularly in transactions. The banking industry is not immune to the impact of ethics on transactions, and some banks are cautious in lending to certain industries due to their ethical implications.

Banks' decisions on ethical implications are influenced by their experience and the performance of industries in their portfolio. For instance, if a particular industry has more problems than others, banks will likely steer clear of that industry. The nice thing is that the Small Business Administration (SBA) data is publicly available. You can access the entire database through the Freedom of Information Act. Everyone, including banks, can parse through the data and determine the better performing industries and franchises.

Despite the availability of data, banks tend to rely more on anecdotal evidence than data. Credit officers in banks may observe that landscaping businesses are having more trouble than others and steer clear of the landscaping industry. This approach is fluid, different from bank to bank, and may vary over time.

It's worth noting that the banking industry is generally old-fashioned, and many banks don't utilize the data effectively. They tend to rely more on anecdotal evidence and their credit officers' experience. Therefore, it's essential to talk to different banks, as different banks have different preferences and may offer industry-specific loans.

For instance, some banks may dislike e-commerce because they've had bad experiences, while others may embrace it and feel confident in evaluating e-commerce companies' risks better. Talking to different banks will help you determine the best bank for your industry.

In conclusion, ethical implications do impact transactions in the banking industry, and different banks have different preferences. Banks' decisions are influenced by their experience and the performance of industries in their portfolio. Although data is publicly available, banks tend to rely more on anecdotal evidence. Therefore, it's advisable to talk to different banks based on your industry to determine the best bank for your business.

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