What happened to Black business loans?

Category: Credit Basics Published: Tuesday, 08 December 2015 Written by Super User

During the 2000 Presidential Election, President George W. Bush made a written pledge to the National Black Chamber of Commerce® (NBCC). He claimed that he would focus on the doors leading to increased capital access for minority businesses. To our astonishment, he delivered on that pledge while Candidate Al Gore refused to make such a pledge. Thus, begun eight years of positive growth in Small Business Administration (SBA) lending.

The above activity soon began to disappear for two reasons: The effects of the subprime mortgage crisis and the lethargic activity coming out of the Obama SBA. President Obama figured the quick fix would be more and more regulation. In 2010, he signed the Dodd-Frank Amendment which poured "mountains" of paperwork and rules for our banking institutions. The push back was major banks began refusing to underwrite small loans, inclusive of the guaranteed SBA loans. When President Bush stepped down the SBA was doing over 8 percent in loans to Black businesses. Today, under the Obama apathy and immense regulations, the SBA is doing less than 1.8 percent in lending to Black businesses.

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