SBA Lending Has Risen This Year, But When Stimulus Money Runs Out, Where Will Additional Funding Come From?

An article in yesterday's New York Times cited a good news/bad news situation with regard to monies available for SBA lending to small businesses. The article, "SBA Lending is Rising, but What Happens When the Stimulus Runs Out?", says that lending backed by the SBA has rebounded back from last winter's low point. But it adds that, unfortunately, the spigot may run dry again when stimulus money runs out. And, it adds that it is unclear whether Congress will be able to find a way to keep the money flowing.

"We're almost back to '08 levels," said Karen Mills, SBA Administrator. "Almost a thousand banks that did not make a loan from that frozen point in October have come back to the program and are making SBA loans. And more than half of those banks hadn't made a loan since 2007."

Since the stimulus law went into effect, Mills said, the SBA has approved $7.7 billion in loans, and "leveraged $9.5 billion into the hands of small businesses."

Officials in Washington are trying to find a way to keep the stimulus going, the article says. It is unlikely to be funded by an additional appropriation, it says. But an aide to a senator on the Appropriations Committee said committee members are looking at legislation that would permit the unused money from the Troubled Asset Relief Program (TARP) allocated to secondary market loans to be used to extend the stimulus provisions.

This would be a positive development for small-business growth.