Has Crowdfunding Become the Ideal Bank Loan Alternative?

Since the 2008 recession, qualifying for a bank loan has been onerous task; applicants are expected to provide collateral, present established business financials, and have a healthy, sustained relationship with said bank. For emerging entrepreneurs, these qualifications are harder to satisfy.
With inflated interest rates, obtaining a loan may be counter-productive for new businesses, especially when crowdfunding has introduced many viable bank loan alternatives in recent years.

With the approval of equity-based crowdfunding in the cards, businesses may have the option to skip lending processes all together, giving out equity in exchange for money. Similarly, debt-based crowdfunding is a possible bank loan alternative, where wealthy investors offer the same funding opportunities, only at a smaller rate. Crowdfunding has become particularly popular with artists, film makers, and developers, who are often most rejected by banks. For this reason, crowdfunding may be the only bank loan alternative for many North Americans moving forward.
In 2012, small businesses raised $2.7-billion, a fraction of what North American banks distributed in loans. While crowdfunding is growing into a substantial source of capital, it has yet to become a primary method of funding. The reason for this is because businesses need long-term funders, not small donations for immediate use. This is the issue with reward-based crowdfunding, and the allure of equity-based crowdfunding. If investors own a portion of the company, the investment is long-term.

Currently, there are portals to help small businesses locate accredited investors with deep pockets to replace the banks: DealStruck, Lending Club, SoMoLend, Kabbage, and Endurance Lending Network to name a few. Ultimately, the goal for users is to secure a loan upwards of $100,000 at a manageable interest rate — somewhere around 5%. But major financial institutions are not going to sit on the side-lines as competition flourishes.
According to a new report written by Nathaniel Karp, BBVA Compass’ Chief Economist, banks may integrate crowdfunding into their own programs. Although there are many risks involved in doing so, this could supply small businesses with more than just the necessary funding to launch off the ground. What are your opinions: is crowdfunding a viable bank loan alternative for small businesses in North America?