Capital Access Programs CAPs loan participation

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From February to September weekly SBA loan dollar volumes rose more than percent compared to the weeks preceding the Recovery Act s passage. The second piece of legislation the Small Business Jobs Act SBJA temporarily continued the increased guarantees and fee waivers and permanently increased SBA loan size limits from million up to million the maximum microloan grew from to . These steps were coupled with efforts to streamline loan paperwork and reduce turnaround times particularly in small dollar loans.

Together these actions resulted in three record years in SBA lending. In alone financial institutions made an SBA guaranteed loan up percent from February . Guarantees have proven to be a very cost efficient government tool when Chinese Overseas America Number Data it comes to small business credit even during strong economic times since they do not require an outlay of cash unless the business defaults. Lenders rely on the full amount of the guarantee as a reduction in their risk. For example a loan guarantee program of million with a proven default rate of percent will be costed at million but will deploy million of new capital into the marketplace. A second important piece of SBJA was the effort to infuse capital into smaller banks and incent them to lend into the small business market. The Small Business Lending Fund SBLF invested over billion in institutions with more than percent increasing their small business lending by percent or more.





The federal government also partnered with state governments through the State Small Business Credit Initiative SSBCI which was funded with . billion from SBJA to support state and local programs that provide lending to small businesses and small manufacturers. To date the SSBCI has funded more than programs including collateral support programs  programs loan guarantee programs and state sponsored venture capital programs. Additionally in the SBA leveraged its partnership with larger banks resulting in of America s top lenders committing to increase their small business lending by more than billion over the next three years a goal that they have exceeded to date.