The SBA recently expanded its lending program to include as many as 1,500 of the country's 10,000 credit unions, allowing for a potential 30 percent increase in the number of lending institutions where business owners can seek start-up or expansion capital.
"The SBA decided to allow credit unions to make SBA-backed loans because of their ability to reach into the communities in which they are located, especially in urban and rural communities that have not been especially well-served by conventional lenders," says Mike Stamler, director of the SBA's press office.
Approved credit unions will be able to make any of the different types of loans under the SBA's 7(a) Guaranteed Loan Program. Potential borrowers may be required to be a member of a credit union to apply for a loan.
By allowing credit unions to make SBA-backed loans, the agency hopes to make business capital more accessible to entrepreneurs across the country. "One of the SBA's lending goals is to make more small loans to the small-business community," Stamler says. "We can't ignore [credit unions'] ability to reach a more diverse pool of prospective and existing small-business men and women."