Congress is puzzling over how to improve lending rates to small businesses in light of a lackluster performance from loan programs through the Small Business Administration.
A Congressional panel debated how to pump more money into the nation’s small-business economy earlier today, saying candidly that loan programs just aren’t working like they should.
“From high-tech start-ups to Main Street mom-and-pop restaurants, small businesses everywhere cannot find the credit they need to survive, retain employees and grow their businesses,” said Rep. Kurt Schrader (D-OR), chairman of the House small business committee’s subcommittee on finance and tax.
SBA-backed loan programs championed by the Obama administration have fallen flat in the face of stricter lending practices. Only a few SBA loans had been made in the Northwest earlier this month.
Now, Congress is toying with the idea of expanding micro-loan programs and revamping the 7(A) loan process. More on possible changes can be found .
“In previous downturns, when credit dried up, the Small Business Administration’s lending programs filled in the gaps, promoting lending and providing firms the capital to drive the economy back toward prosperity,” Schrader said. “Unfortunately, in this recession, the SBA’s capital access programs have been unable to fill their traditional role, leaving many small businesses with few financing options. Bolstering the SBA’s lending initiatives will get credit flowing again to small firms.”
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