FOR IMMEDIATE RELEASE
ICBA Backs Bill to Bolster Small Business Financing
Washington, D.C. (April 27, 2005) - Small businesses and budding entrepreneurs would have a better chance of securing affordable financing to start or grow their businesses under new legislation introduced in the U.S. House of Representatives today.
Participating in a press conference in the U.S. Capitol this morning, the Independent Community Bankers of America (ICBA) praised House Small Business Committee Ranking Member Nydia Velàzquez (D-N.Y.) for proposing the Small Business Access to Capital Act. The bill would make capital through the Small Business Administration's 7(a) loan program more affordable for small businesses that need it most.
The Small Business Access to Capital Act would scale back borrower fee increases in the 7(a) lending program; restore the program's combination ("piggyback") financing; increase the maximum loan limit to $3 million (from $2 million); and increase the program's guarantee on such loans to $2 million (from $1.5 million).
ICBA member William Gossett, president of Islands Community Bank in Beaufort, S.C., and a 30-year provider of SBA loans, participated in the press conference to show his enthusiastic support for the bill. "The steep fee increases applied to the 7(a) loan program are chocking off beneficial SBA lending in our communities," Gossett said. "High fees are making the program prohibitively expensive for many worthy small business borrowers. And that's unfortunate, because the SBA 7(a) lending program has been wildly successful in reaching small businesses that cannot secure traditional financing, the very businesses that create the new jobs our communities need."
Currently, the SBA 7(a) program provides nearly one-third of all long-term capital funding for small business. "Community banks widely and successfully leverage the SBA's flagship 7(a) lending program to provide thousands of special loans to new and growing small businesses every year, creating jobs and stronger local economies nationwide," said Camden R. Fine, ICBA president and CEO. "We will continue to press for a robust and affordable SBA 7(a) program."