The House Small Business Committee held a full
committee hearing titled, "Access to Capital: Can
Small Businesses Access the Credit Necessary to
Grow and Create Jobs?" The hearing provided a forum
for lenders and business owners to discuss the
current economic environment and what's being done
to support private sector job growth.
Witnesses from the lending side discussed the
demand for capital and current initiatives to
encourage small business lending. Other witnesses
reported about the current economic environment and
the capital required to hire new workers.
House Small Business Committee Chairman Sam
Graves, R-Mo., opened the hearing. He said, “As
America seeks to recover from the worst recession
since the Great Depression, we will be relying on
our nation’s small businesses to help lead the way.
For businesses to expand and create jobs, they need
adequate financing. However, small businesses are
telling us that access to capital remains a hurdle
in the current economy, despite rallies on Wall
Street and government efforts to loosen credit.
On the other side of the equation are
lenders who say they have capital available, but
businesses are not as credit-worthy as they were
just a few years ago. Banks claim that today’s
borrowers have lower credit scores and lower
collateral values due to depressed real estate
values.”
Lynn Ozer, executive vice president of
Susquehanna Bank, Pottstown, Pa., testified during
the hearing on the importance of bank lending’s
role. “This growth in the 7(a) program is essential
to keeping credit flowing to small businesses
because the program fills a critical gap for those
businesses, particularly startup and early-stage
companies that need access to longer-term loans,”
he said. “The Small Business Administration,
through its private sector lending partners,
accounts for well over 40 percent of all long-term
small business loans made in America, making the
agency the single largest provider of long-term
capital to U.S. small businesses.”
