Biden-Harris Administration Announces Record $3 Billion in Lending to Latino-Owned Small Businesses
Number of SBA-Backed Loans to Latino-Owned Small Businesses Has Doubled Under Biden-Harris Administration
WASHINGTON, Oct. 16, 2023 (GLOBE NEWSWIRE) — Today, Administrator Isabel Guzman, the voice in President Biden’s Cabinet for America’s more than 33 million small businesses, announced newly finalized Fiscal Year 2023 SBA data showing that the rate of SBA-backed loans to Latino-owned small businesses has now doubled under the Biden-Harris Administration, topping $3 billion in lending.
“Our country is experiencing a small business boom driven significantly by the entrepreneurial spirit, drive, and resilience of the Latino community – and the Biden-Harris Administration is working to reverse historic underinvestment in Latinos to unleash their full potential and advance our economy and global competitiveness,” said SBA Administrator Isabel Guzman. “Under President Biden’s Investing in America agenda, the SBA has doubled the number of loans it backs annually to Latino-owned small businesses and reached a record $3 billion in lending to Latino business lending in Fiscal Year 2023 – an 80 percent increase from 2020. While there remains work to be done, this data is an encouraging sign of progress that the SBA will continue to build on as we seek to close long-standing gaps in lending to Latino-owned small businesses.”
In a tightening credit environment, the SBA’s lending programs offer small businesses a critical alternative: affordable loans backed by the federal government. The SBA backed more than 7,700 SBA loans to Latino-owned small businesses in Fiscal Year 2023 through the agency’s signature 7(a) and 504 loan programs, double the number in Fiscal Year 2020. Total loan dollars ($3.0 billion) are up nearly $1.4 billion since the start of the Biden-Harris Administration, while the Latino share of the SBA’s lending portfolio rose from under 8 percent to over 12 percent.
SBA 7(a) & 504 Loans to Latino-owned businesses FY2017-FY2023 (table)
Share (% of loans)
|SBA 7(a) & 504 Loans to Latino-owned businesses||FY 2017||FY 2018||FY 2019||FY 2020||FY 2021||FY 2022||FY 2023|
|Share (% of loans)||8.2%||8.4%||9.0%||7.8%||8.4%||10.0%||12.2%|
Under the Biden-Harris Administration, the United States has experienced a historic small business boom being led by women and people of color, and the SBA’s FY23 loan programs supported that trend, with 11 percent more loans delivered to small businesses than in FY22. Latino entrepreneurs are at the very center of this transformative growth, as America continues to experience the fastest creation rate of Latino-owned small businesses in more than a decade — over 20 percent faster than pre-pandemic levels.
The SBA has taken significant steps aligned with the President’s Investing in America agenda to increase access to its core capital programs, including among Latino entrepreneurs. These include:
- Expanding the Community Advantage Program, which supports lending to small businesses in underserved communities through mission-driven, community lenders, and making mission-oriented lending a permanent part of the SBA loan program through the Community Advantage Small Business Lending Company license;
- Deploying the $100 million Community Navigator Pilot Program funded under President Biden’s American Rescue Plan;
- Launching the Biden-Harris Administration’s cross-country Latino Prosperity Tour;
- More than tripling the number of Women’s Business Centers at Hispanic-Serving Institutions; and
- Implementing new reforms to address persistent capital access gaps.
The SBA’s 7(a) loan is SBA’s primary business loan program. It provides guarantees to lenders that support financing to small businesses for working capital and a range of other uses, up to $5 million. The SBA’s 504 loans provide long-term, fixed-rate financing up to $5.5 million for major fixed asset purchases by small businesses.
The SBA guarantee enables lenders to offer credit to small businesses that otherwise would not qualify. SBA lenders must adhere to interest rate caps and fee restrictions; they often help borrowers by providing more extended repayment periods that would otherwise be unavailable.
About the U.S. Small Business Administration
The U.S. Small Business Administration helps power the American dream of business ownership. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow, or expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov.
CONTACT: Christine Saah Nazer U.S. Small Business Administration (202) 756-0304 [email protected] Han Nguyen U.S. Small Business Administration (202) 756-0304 [email protected] Press Office U.S. Small Business Administration (202) 756-0304 [email protected]
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