SBA to get emergency cash infusion

As part of the defense spending bill headed for a final vote in the Senate this weekend, the Small Business Administration (SBA) will receive $125 million to continue two programs that were part of the $787 billion fiscal stimulus package. The administration urged Congress to pass the emergency funds because the SBA ran through the existing money this fall.

The $125 million likely will carry the programs through February.

ADVERTISEMENT
Lawmakers earlier this year had included $375 million to support SBA programs to spur lending through higher guarantees and reduced fees. Financial lobbying interests, including the Independent Community Bankers of America (ICBA), have pushed for additional money for the programs since they ran dry.

The Obama administration has been working on ways to boost bank lending over all, with President Barack Obama meeting recently with the heads of the nation's biggest banks.

The administration is looking in particular at ways to ease the flow of credit to small businesses.

The administration credits the programs with rejuvenating lending for small businesses. Loan volumes under SBA crashed during the financial crisis. The administration says the programs have supported $15 billion in loans since the stimulus package was signed into law.

The Obama administration continues to urge Congress to authorize the programs through the end of 2010.