Nice to see that the SBA is taking our advice and expanding the microloan program with funds from the Recovery Act:
With the American Recovery and Reinvestment Act funding an additional $50 million for loans and $24 million for technical assistance, the U.S. Small Business Administration is expanding its Microloan program and increasing access to capital for small businesses across the country.
The $24 million for technical assistance is to bribe…I mean, “help” new loan intermediaries (banks or other microlenders) conduct training and counseling for borrowers. This helps because banks don’t have a lot of incentive to make these low-profit loans otherwise. Their main reward might be the customers who are attracted through the microlending program and end up with a larger, more lucrative business loan at some time in the future.
This is all well and good, but I’m not sure $50 million will make much of a dent.
More information about the SBA Microloan program is located here.
Filed under: Money & Capital, SBA Tagged: | business lending, business startup, microloan, Recovery Act, small business loan, U.S. SBA
