WASHINGTON—NAFCU and the Small Business Administration have signed a Memorandum of Understanding (MOU) aimed at improving lending to entrepreneurs and small business.
“The SBA and NAFCU are formalizing a national partnership to promote small business lending. Credit unions help their members with so many other financial needs, and we want them to be able to help the entrepreneurs they serve with SBA loans as well,” said Maria Contreras-Sweet, the head of the SBA. “Credit unions have stepped up and stepped in to fill a real need, adding outlets for SBA loans in communities that need our assistance the most. SBA’s joint effort with NAFCU will make credit unions even more valuable as we work to give credit where it’s due to small business across the nation.”
NAFCU CEO Dan Berger noted that the partnership with the SBA is “valuable” because “each dollar of an SBA-guaranteed business loan from a credit union is excluded from the credit union’s member business lending cap. This affords credit unions much-needed flexibility to serve their small business members.”
A statement from both organization said the partnership will increase the availability of small dollar loans by providing more outlets entrepreneurs can access SBA products in their neighborhoods. Second, it will help small business owners get capital for investments into their new or existing business they may have otherwise put on a high-interest credit card or a personal credit line. Third, it will make the small dollar loans more accessible to underserved communities, including women and minorities.