Farmingdale, NY – U.S. Senator Kirsten Gillibrand today stood with local business owners and community leaders at Farmingdale State College to announce bipartisan legislation, the Microloan Modernization Act, to expand the Small Business Administration’s (SBA) Microloan Program that provides loans and technical assistance to women and minority business owners, among other entrepreneurs. These entrepreneurs face challenges accessing the capital needed to start and expand small businesses because they are often denied loans by banks.
The legislation Gillibrand is announcing would strengthen the SBA Microloan Program by raising the total limit on outstanding loans to intermediary lending organizations, which would allow for more loans to be made to women, minority, and other business owners. The Microloan Modernization Act also expands opportunities for more hands-on training assistance to help small business owners succeed. This bipartisan legislation was sponsored by Senator Deb Fischer (R-NE) and has passed in the House of Representatives. The bill is also cosponsored by Senators Tim Scott (R-SC), Chris Coons (D-DE), Jeanne Shaheen (D-NH), Joe Donnelly (D-IN), and Gary Peters (D-MI).
According to the U.S. Senate Committee on Small Business and Entrepreneurship, women receive less than 5 percent of conventional small business loans, even though women-owned businesses make up nearly 40 percent of all businesses in the country. Additionally, the U.S. Department of Commerce has found that among smaller minority-owned businesses, loan denial rates for minority firms were about three times higher compared to those of non-minority-owned firms. A report from the Long Island Association also found that small businesses account for close to 90 percent of all businesses on Long Island, showing their importance to the region’s economy.
“Too many would-be small business owners struggle to get loans from banks to start their businesses. More often than not, the people who lose out are women and minority New Yorkers,” said Senator Gillibrand. “The bipartisan Microloan Modernization Act would help ensure that every hardworking entrepreneur who wants to start a business has a chance to do it. If we really want to fix our economy, then we need to start rewarding work and entrepreneurship again, and this bipartisan bill is a good place to start.”
“This is a terrific program expansion being proposed by Senator Gillibrand. I will work closely with our local chambers of commerce and business councils to educate their members about this opportunity,” said Nassau County Executive Laura Curran. “The MWBE community will be excited about participating. Nassau County will raise awareness and support small businesses.”
“Microloans from responsible lenders are critical to the success of smaller businesses,” said Steve Cohen, President of Excelsior Growth Fund, a nonprofit business lender in New York. “We applaud Senator Gillibrand’s efforts to increase access to capital for small firms, particularly minority and women-owned business enterprises.”
“Farmingdale State College shares Senator Gillibrand’s goal of expanding entrepreneurial opportunity,” said Farmingdale State College President John S. Nader. “Our Small Business Development Center serves precisely the population the Senator is assisting with this legislation.”
Since its inception, the SBA Microloan Program has delivered more than $722 million in loans to small businesses across America that have created or retained 212,000 jobs. In Fiscal Year 2017 alone, the program loaned over $8.4 million to 821 New York entrepreneurs and business owners. The SBA Microloan Program makes direct loans and grants to intermediary, non-profit organizations that in turn provide microloans of up to $50,000 and business-based training and technical assistance to start-up and growing small businesses. The average loan size is $13,000.