Possible Financial Relief for Small Business Owners
Last week the U.S. Senate voted to include a proposed $30 billion lending program in a small business aid package it will be examining soon. If approved, the measure would enable community banks to provide an abundance of SBA loans to small business. Approximately $12 billion in tax breaks for small businesses, as well as the beefing up of several other government lending programs would also be included.
Here is my take: 1. A large pool of available funds is welcomed news since lenders have been very tight with approving loans. 2. There should be some concern because in the government’s haste to push $30 billion into a flailing economy, an abundance of bad loans may be generated. 3. Doesn’t it seem odd that only community banks will be allowed to lend these funds? Non-community banks have the kind of market share and geographical scope to push these funds into the market more quickly and, perhaps with better controls. Why not let all banks participate?
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