WASHINGTON (12/3/12)--Increasing the credit union member business lending (MBL) cap is "simply common sense," John Arensmeyer, CEO of The Small Business Majority, and Erica Schroder, operations director at R Street Institute, said in a joint Huffington Post column published late last week.
The co-authors noted that while their organizations are often on opposite sides of the ideological spectrum, they both believe that the U.S. Congress must act to free up more small business credit. "In particular, we think lawmakers should approve a regulatory relief effort that would allow credit unions to lend more money to small business," they said.
The column cited a Small Business Majority survey, which found that more than 60% of small business owners are having issues accessing the credit they need. "Congress has made an effort to change this situation, such as creating a 'small business lending fund,' but the numbers demonstrate it's just not enough. A pragmatic solution to this problem is to change outdated regulations that limit credit unions--democratically governed, nonprofit financial cooperatives--from meeting consumer needs," the columnists wrote.
"Getting more credit to small business owners can get them, and the national economy, on track to a full and sustained recovery. There's no reason for Congress to delay action. Credit unions must be allowed to make more loans to small businesses," the column added.
Bills that would increase the credit union MBL cap to 27.5% of assets, up from the current 12.25% cap, have been introduced in the U.S. House (H.R. 1418) and Senate (S.2231).
The Senate MBL legislation could be considered any day during the lame duck session. The Credit Union National Association (CUNA) has estimated that the proposed MBL cap increase could inject $13 billion in funds into the economy, creating as many as 140,000 new jobs in the first year following enactment.
For the full Huffington Post column, use the resource link.