WASHINGTON – Today, Administrator Isabel Guzman, head of the U.S. Small Business Administration (SBA) and the voice in President Biden’s Cabinet for America’s more than 33 million small businesses, announced that the SBA has granted three new Small Business Lending Company (SBLC) licenses to lenders focused on historically underserved markets – the first expansion of the SBLC program in more than 40 years. The lending companies – Arkansas Capital Corporation, Alaska Growth Capital BIDCO, Inc., and Funding Circle – will help support SBA’s ongoing efforts to increase access to affordable capital for business owners in underserved markets across America, expanding on the Biden-Harris Administration’s agenda to advance equity and build an inclusive economy.
“The success of America’s 33 million small businesses is a pillar of Bidenomics and foundational to the prosperity of our economy, global competitiveness, and democracy,” said Administrator Isabel Guzman. “Persistent barriers to capital, especially smalldollar loans, still pose a challenge to many of the entrepreneurs who power our economy. The Biden-Harris Administration remains committed to filling capital market gaps – and the expansion of the SBA’s SBLC program after more than forty years is a monumental step forward in this crucial effort. With the addition of three new Small Business License Companies, the SBA will be able to serve even more small business owners who need capital to start, operate, and grow their businesses.”
In June, the SBA announced that it had opened a window for new applications for Small Business Lending Company (SBLC) licenses. The SBA approves Small Business Lending Company Licenses for selected non-depository lenders to increase responsible small business lending. An SBLC license allows the lending organization to utilize government guarantees when underwriting small business loans to reduce the level of risk to the lender and cost to the borrower. As a result, SBLCs are positioned to write higher volumes of loans to small businesses than possible without a government guarantee. The SBA’s existing SBLCs outperform banks and credit unions in lending to minority-owned businesses. There are currently 14 SBLC licenses in the marketplace, and the addition of Arkansas Capital Corporation, Alaska Growth Capital BIDCO, Inc., and Funding Circle will bring the total to 17, helping bring capital to new markets.
“For over thirty years, Arkansas Capital Corporation has used the SBA 7(a) program to support small businesses in underserved areas of Arkansas where accessing capital is uniquely cumbersome,” said Sam Walls III, CEO of Arkansas Capital Corporation. “Arkansas Capital has bolstered regional economic development, but now with this SBLC license, we can widen our SBA 7(a) footprint as well, expanding our services to rural and poverty-stricken areas in the South to start. We are honored that the SBA chose Arkansas Capital as one of the three recipients of this license, and we look forward to working with the SBA in the years to come as we seek to break down barriers to accessing affordable, reliable capital.”
