FY 2020 SBA Microloan Appropriations
The SBA Microloan program consistently helps fill those gaps left by the private sector. The Friends of the SBA Microloan Program strongly support SBA’s Microloan and Microloan technical assistance programs and request Congress provide at least $39.5 million in the FY20 Appropriations bill to finance, support, and grow small businesses in communities across the country.
- Read Senate Sign-On Letter for FY 2020 Appropriations
- Letter Endorsing S. 996, The Microloan Enhancement Act of 2019
The SBA Microloan program was authorized in 1991 (P.L. 102-140) to provide technical assistance and small-scale loans to small businesses that are unable to qualify for conventional loans and other SBA guaranteed loans. Working through a network of community based intermediary lenders, the SBA Microloan program is able to finance and support new, early stage and existing businesses in underserved markets in rural and urban areas. The program has been successful in helping women, minorities, low-income, and veteran entrepreneurs turn their dreams into successful ventures that create jobs and grow the economy.
Access to capital is critical to the long-term success of small businesses. While the official SBA definition of a small business is a company with fewer than 500 employees, more than 80 percent of all businesses in this country employ 10 or fewer employees. The Microloan program is especially helpful to these smaller businesses because it allows intermediary lenders to provide small loans of up to $50,000 with fixed rates and tailored to their individual business needs.
The Microloan technical assistance program also provides participating intermediary lenders with matching grants for intensive marketing, management, and technical assistance to micro borrowers. These lenders are a “one-stop shop” where small businesses can secure flexible financing as well as individualized technical assistance as needed during the life of a loan. The fusion of loans and ongoing technical assistance is the linchpin of the program’s success.