WASHINGTON, Oct. 20, 2023 (GLOBE NEWSWIRE) -- This week at the Opportunity Finance Network (OFN) annual conference, Administrator Isabel Guzman, head of the U.S. Small Business Administration (SBA) and the voice in President Biden’s Cabinet for America’s 33 million small businesses, announced that the SBA has successfully made permanent its mission-lending Community Advantage Program as a result of its recent rule changes and the launch of 143 Community Advantage Small Business Lending Companies (CA SBLCs), giving these mission-based lenders a permanent home in SBA lending to continue serving small businesses in underserved markets. The CA SBLC license builds on the success of more than a decade of the Community Advantage Pilot Program.
“Access to capital remains the greatest barrier for entrepreneurs looking to add jobs or start and grow their businesses – especially women, people of color, veterans, and rural and LMI communities,” said SBA Administrator Isabel Guzman. “Under the Biden-Harris Administration, the SBA has prioritized closing longstanding capital gaps by expanding the number of lenders focused on underserved markets so these highly entrepreneurial communities can power our economy. As a result of our transformative regulatory reforms, the SBA has now made permanent and expanded its number of mission-driven lenders in Community Advantage SBLC to over 140 strong. These lenders will help fund and power our nation’s small business boom and ensure small businesses can benefit from the President’s Invest in America economic agenda.”
“The new Community Advantage Small Business Lending Company (CA-SBLC) licenses in the 7(a) Loan Program ensures that mission lenders, like CDFIs, can continue to partner with the SBA in supporting small businesses across the country. After more than a decade as a pilot program, the CA-SBLC license provides certainty to underinvested small businesses and the specialized lenders that serve them,” said Harold Pettigrew, President and CEO at Opportunity Finance Network. “We applaud the leadership of Administrator Guzman and the SBA for revitalizing this underutilized SBA program and ensuring the tools and resources are available to close the capital gaps that persist for far too many entrepreneurs.”
The SBA’s strengthened network of CA SBLCs includes all 112 of the Community Advantage Pilot Lenders who wanted to continue SBA lending, collectively representing 99.8% of the original CA Pilot Program’s lending portfolio, along with 31 new mission lenders approved in the last sixty days.
The Community Advantage Loan Pilot Program – originally launched during the Obama-Biden Administration and set to expire in 2022 before the Biden-Harris Administration extended it – was designed to connect underserved small businesses to capital by providing mission-oriented lenders access to 7(a) loans. The Pilot Program will sunset on October 31, 2023, to make way for the permanent role of the CA SBLCs within the SBA lending ecosystem.
The Community Advantage Pilot Program grew significantly during the Biden-Harris Administration, lending over $141 million in fiscal year 2023 (FY23) – up from $86 million in FY20.
Community Advantage lenders serve businesses that historically have been excluded from access to capital due to limited financial resources and many other systemic barriers. Under the Pilot Program, Community Advantage lenders have contributed to small-dollar lending outcomes that increased lending to Black and Brown borrowers.
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About the U.S. Small Business Administration
The U.S. Small Business Administration helps power the American dream of business ownership. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow, expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov.
Christine Saah Nazer U.S. Small Business Administration (202) 756-0304 Christine.SaahNazer@sba.gov
