Possible Increase in Credit Union Lending Cap
The Small Business Lending Fund and several characteristics of small banks have made community banks an appealing option for small business loans, as discussed last week. Banks aren’t the only place to look for capital though. An alternative to banks, small or large, is credit unions. Credit unions may become an even more promising source of business loans.
Lobbyists for credit unions are pushing for legislators to increase the current percentage of assets, 12.25%, that a credit union can lend businesses to 27.5%. One lobbyist group, the Credit Union National Association, estimates this change could add an additional $13 billion in business loans the first year. Banks are fighting against a raise in the credit union lending cap.
Bills to raise the percentage of assets that credit unions can lend businesses are moving through the House and the Senate. An increase in the lending cap of credit unions would increase your chance of getting a loan for your company. Between the Small Business Lending Fund and the possibility of more loans from credit unions there is a growing amount of money available for small business.