The Small Business Financing and Investment Act will help open tight credit markets that have shut out small business owners during this economic crisis, so they can create jobs, particularly in struggling regions and industries, he said.
“This bill is extremely important for small business owners and for those who are looking for jobs. Small businesses are the number one source of new jobs in this country,” Hinojosa said.
Small businesses create 60-80 percent of new jobs every year, but the current economic crisis has frozen credit and made it difficult for American small businesses to get the financing they need, he said. By comprehensively updating the Small Business Administration’s capital access programs, the legislation is expected to support $44 billion in lending and investment for smaller firms.
“As a former small business owner, I know how important these programs are and what they can offer to an entire community,” Hinojosa said. The legislation also includes incentives to encourage local banks to lend to small businesses and reduces bureaucratic red tape, making it easier for entrepreneurs to secure credit, he added. The bill creates a new public/private partnership to expand investments in small business startups, an important source of job creation. It also extends critical Recovery Act provisions eliminating fees on Small Business Administration loans and guaranteeing up to 90 percent of 7(a) loans. To foster a diverse mix of businesses, it takes steps to promote veteran-owned, women-owned and rural small businesses, he said.