My Business Credit Journey to 1,000,000

I was thinking about my next post when I three emails between yesterday and today asking about CIT and their bankruptcy and how it will involve us in the business credit world. There are a couple things we have to address prior to even thinking about answering this question. Is CIT bankrupt? How much do we really depend on CIT for our business credit accounts? Will an additional bank take over accounts backed by CIT?

The truth is, CIT is not bankrupt, at least not for now. They filed for bankruptcy protection. CIT is in a reorganization phase and it plans to decrease its debt by $10 billion. This does not signify that they arfie in the clear, we should still be wary of the potential BK. The depressing thing is, by the time we actually read about their BK(if it happens), they would have already filed.

On the question of our dependency on their credit, this is a  subjective one. In this precise moment, the only CIT account that I can think of, that is accessible with no PG is Dell. Now this is a huge deal as many of us look forward to getting a dell business credit account with no PG. I myself have been having some troubles with getting approved regularly. It seems that some of their restructuring has to do with tightening their belts. But that is predictable and expected. On the other side, “CIT is a lender to nearly a million mostly small and midsize businesses and companies, and while its failure may not jolt financial markets in a large way, it could hurt the flow of credit to many businesses to whom banks traditionally won’t lend.”  (according to bloomberg). So for those of us who get financing from CIT with PG’s, this may reduce the amount of credit that is offered.

At any time a bank disappears, we have hopes of an additional bank stepping in and filling their shoes. The sad thing is that we have not seen that with HSBC leaving office depot business credit and Best Buy business credit accounts. The good thing though, is CITI may finance dell, as they have in the past. ALl is not lost, and I do not think that we should hold our heads, at least not yet.
CIT is at least 100 years old, and I will hope that they will stand the waves.

Marc