Amid misgivings over his spending blueprint, President Obama has decided to provide billions of dollars in federal lending aid aimed at struggling small-business owners.
The broad package of measures to be announced today includes $730 million from the stimulus plan that will immediately reduce small-business lending fees and increase the government guarantee on some Small Business Administration loans to 90%.
The government also will take aggressive steps to boost bank liquidity with more than $10 billion aimed at unfreezing the secondary credit market.
“It’s a huge step in the right direction,” Giovanni Coratolo, director of Small Business Policy at the U.S. Chamber of Commerce, said. “In this economy, having the least amount of risk for banks will incentivize banks to lend to small businesses. A lot of small businesses will benefit from this.”
Photo by Angela Radulescu.