New Rochelle, NY – U.S. Senator Kirsten Gillibrand today stood with local business owners and community leaders at Modern Paint and Hardware 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 announced 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 passed with unanimous support by the Senate Small Business Committee this month, and has passed in the House of Representatives. The bill is sponsored by Senator Deb Fischer (R-NE) and 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 says 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.”
“I am hopeful for swift action by the full Senate on S. 526, the Microloan Modernization Act, to join the House and pass this important legislation designed to help our small businesses startup, grow and succeed. This is just the type of bipartisan legislation the Congress can enact which will have a near immediate benefit to our small businesses, which are essential to our local communities and will also help to create jobs,” said U.S. Representative Engel.
“Small businesses are the backbone of our economy, and women and minority-owned businesses are essential to our communities. This important legislation will give these businesses access to funds and knowledge that will help them succeed. Their success strengthens our communities and economy and I am proud to support them,” said Senator Andrea Stewart-Cousins.
“Westchester thrives when Minority and Women Owned Businesses are thriving. These businesses are an essential driver of our County’s economic development. I am glad to support this bi-partisan federal initiative that will improve access to capital and technical assistance for small businesses,” said Westchester County Executive George Latimer. “I look forward to working with U.S. Senator Gillibrand, and our Congressional delegation, to enact legislation that will directly benefit Westchester businesses.”
“This legislation that Senator Gillibrand is introducing can help create an easier and more efficient path to accessing the capital needed to grow and succeed. This will help transform the many lives of those looking to follow their dream of small business ownership,” said Maura McCosker, Chief Operating Officer, The Modern Paint Group, LLC.
“As the SBA Microlender serving Westchester and the Hudson Valley, we are thrilled with the Senator’s bill to Modernize the SBA Microloan Program. Community Capital is a not for profit alternative lender that provides loans and small business training and technical assistance to start up and emerging businesses. The SBA Microloan Program is a critical partner in making it possible for us to meet the capital needs of women and minority business owners who often face challenges in securing loans from traditional lenders. Increasing the borrowing limits that we face with the SBA will ensure that more capital reaches more businesses in our region more quickly, and we are grateful to the Senator and her colleagues for focusing on the needs of small businesses everywhere,” said Kim Jacobs, Executive Director, Community Capital New York.
“This legislation would make much needed changes to the SBA Microloan program, which is of critical importance to women entrepreneurs in helping them have access to capital to start and expand their businesses, create jobs and grow the economy,” said Anne M. Janiak, Chief Executive Officer, Women’s Enterprise Development Center Inc.
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, which in turn provide microloans of up to $50,000, business-based training, and technical assistance to start-up and growing small businesses. The average loan size is $13,000.