Under a new bill, a separate SBA loan approval and repurchase program would be established for credit unions.
Introduced in early March, the Credit Union Small Business Lending Act (H.R. 4191), would simplify the SBA application process for credit unions and boost coordination between the agency and the NCUA.
As proposed, the legislation would also guarantee 85% of loans that credit unions provide to members that reside in designated underserved areas. The loans would not exceed $250,000. The guaranteed portion of SBA loans does not count toward the credit union member business lending cap.
Representatives from CUNA met with the SBA this week to discuss the agency’s loan programs credit unions are eligible to participate in, and how both entities can best ensure that credit unions are aware of those options.
According to the SBA, it backed $30.5 billion in loans to start-ups and small businesses in fiscal year 2011.
The Credit Union Small Business Lending Act was introduced by Reps. Kurt Schrader (D-Ore.) and Steve Chabot (R-Ohio).