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Contact: Alisa Harrison, 202-628-8000
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WASHINGTON, Dec. 10, 2009—The International Franchise Association today released a support letter signed by 55 other business trade groups calling for swift action by Congress on legislation to increase access to credit for small businesses. Many of these provisions were among the measures suggested this week by President Obama in his speech at the Brookings Institution.
“We are pleased that the President continued to acknowledge that the lack of credit availability for small businesses is slowing the recovery efforts and stalling the significant job creation potential of small business entrepreneurs,” said IFA President & CEO Matthew Shay. “Small businesses cannot be the engine of our economy if they have to line up in a queue and wait to see if they can gain access to credit. Congress needs to act swiftly and restart the flow of credit to America’s job-creating small businesses or else these entrepreneurs will be left to sit on the sidelines.”
In a letter to members of Congress, IFA and 55 other business groups identified immediate steps that could improve credit access, including an increase in the maximum loan size and the maximum guaranteed portion of Small Business Administration (SBA) loans and called for by President Obama.
The groups urged passage of legislation proposed by Sen. Mary Landrieu (D-LA) and Sen. Olympia Snowe (R-ME), the Chair and Ranking Member of the Senate Small Business Committee, to increase the maximum size of SBA 7(a) and 504 loans from $2 million to $5 million. These bills would also provide a commensurate increase in the statutory maximum guaranteed portion of SBA 7(a) loans.
The groups also urged support appropriations to extend the Small Business Administration (SBA) loan provisions of the America Recovery and Reinvestment Act (ARRA) through all of Fiscal Year 2010. SBA estimates that $479 million in appropriations is needed to fund the extension of the higher guaranty percentages and waiver of borrower fees for the balance of the fiscal year.
“These stimulus provisions have been so successful that the money allocated thus far has been exhausted,” Shay said. “The depletion of funds is proof that the SBA programs were, and continue to be, critically important for our nation’s credit-worthy entrepreneurs.”
Shay added that the Recovery Act provisions have made a real difference for small businesses, but the recovery has not been completed.
“Lenders were returning to the SBA programs and providing loans of all sizes to the nation’s small businesses – and this momentum needs to continue,” he said. “We urge Congress to quickly provide the appropriations necessary to extend the ARRA provisions so small businesses can access the funds they need to hire, expand inventory, purchase machinery and equipment or real estate.”
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About The International Franchise Association
The International Franchise Association, the world’s oldest and largest organization representing franchising, is the preeminent voice and acknowledged leader for the industry worldwide. Approaching a half-century of service with a growing membership of more than 1,250 franchise systems, 10,000-plus franchisees and more than 500 firms that supply goods and services to the industry, IFA protects, enhances and promotes franchising by advancing the values of integrity, respect, trust, commitment to excellence, honesty and diversity. For more information, visit the IFA Web site at
www.franchise.org
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