• Small-Business Lending Is About to Change, With Simpler Requirements

  • Aug 2 2023
  • Length: 2 mins
  • Podcast

Small-Business Lending Is About to Change, With Simpler Requirements

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  • Small-Business Lending Is About to Change, With Simpler Requirements
    The Biden Administration is making it simpler for many small business owners to get the loans they need to start and grow their businesses.
    As part of a series of changes, the Small Business Administration is simplifying loan requirements, making it easier for financial-technology firms to participate. The SBA is also increasing the scope of nonbank lenders that are licensed to issue SBA loans.
    Check out Our David Allen Capital Site to apply for business Loans at David Allen Capital Dot Com Slash Cordial Bank.
    Many of these changes went into effect August 1 and were launched to assist small businesses that have had difficulty securing funding, given many banks have focused more on larger commercial borrowers.
    "Capital is the catalyst to starting and growing small businesses. The changes Administrator Guzman is making to SBA small business loan programs are critical to addressing persistent capital access gaps, particularly for rural and minority-owned small businesses," Han Nguyen, SBA spokesman, said in a statement to Insider. "By leveling the playing field and fostering inclusive opportunities through these actions, we are paving the way for diverse and dynamic small businesses and innovative startups to grow, creating a stronger and more resilient economy for all."
    SBA loans, typically made by banks and other financial institutions, help entrepreneurs start and grow their small businesses. Entrepreneurs can borrow up to $5 million in SBA-backed loans. According to the SBA's 2023 budget request, the agency helped back $34 billion in loans in 2021. The SBA typically promises to cover between 75% to 85% of loan principals, making the loans less risky and more appealing for lenders.
    As part of the new lending criteria, the SBA will:
    Allow lenders to make SBA loan decisions according to their existing practices for non-SBA loans, such as using credit scores, revenues, and equity to approve or deny loan applications.Reduce the cost and complexity of smaller loans by providing more flexibility.Removing cumbersome paperwork for lenders.
    "These changes will expand the number of creditworthy business owners who can access SBA loans, including among women, minority entrepreneurs, employees purchasing a portion of a business from its owner(s), and startup small businesses," the SBA said in a statement.

    Apply for business Loans at: www.davidallencapital.com/cordialbank
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