Over the past three years, the Obama administration has made it a top priority to increase access to capital for small business owners across America. When I came to SBA in early 2009, small business owners would say to me, “I need a loan to survive.” Since that time, SBA has worked hard to provide small businesses with access to capital – even during the depth of the recession. Thanks to the Recovery Act and the Small Business Jobs Act, SBA had a record year in FY2010, supporting more than $30 billion in small business lending across the country.
Now we’re getting encouraging news that business lending is showing new signs of strength. You may have seen that the FDIC recently released data showing that banks had their biggest increase in business lending in four years. And the Wall Street Journal recently wrote “At Last! Banks Are Making New Loans.” Lately, small business owners are no longer telling me they’re fighting for survival; they’re talking about needing a loan to take advantage of a new opportunity, hire another worker or buy more inventory. There are additional signs that more money is getting into the hands of business owners. The Department of Treasury began receiving reports from the banks that participated in the Small Business Lending Fund (SBLF). Already these financial institutions, mostly community banks, have increased their small business lending by $3.5 billion. And, the 27 states participating in the State Small Business Credit Initiative are also putting the funds to use, supporting lending to small businesses and small manufacturers.
Of course, we all know that even though lending is on the rise, there’s still more to be done. That’s why SBA is working hard to continue filling gaps in the market place. For example, we’re working with some of the largest lenders around the country, who last year committed $20 billion for small business lending over the next three years. We’re also working to streamline our processes and make it easier for small businesses to benefit from our programs. We recently revamped the CAPLines program to provide a working line of capital to certain businesses, including manufacturers and government contractors. We also created new programs, such as Small Loan Advantage and Community Advantage, which incentivizes lenders to make small-dollar loans and opens up SBA programs to new lenders, such as CDFIs.
We’re confident that this is just the beginning of the momentum small businesses need to keep growing and creating jobs. Everyone at SBA recognizes that this is a critical time for small businesses, and we’re committed to helping them get the financing they need so they can lay the foundation for an economy built to last.