April 4, 2012 -- Government efforts to pump money into small businesses have not come close to the level of lending that small businesses need. The Small Business Loan Act, passed in 2010 by Congress, was an effort to give money to banks to lend. It has failed; only 13 percent of the money set aside in the fund was actually loaned out by banks to small businesses. By contrast, credit unions are prepared to lend more than $800 million in loans to small businesses in Texas – without using taxpayer money.
The increase in small business lending hinges on the passage of a bill in the US Senate; Senate bill 2231, which will raise the regulatory cap on credit union business lending from 12.25 percent to 27.5 percent of assets. This bill, in contrast to previous efforts to help small business, will not cost the taxpayers a dime. And according to experts, the increase will add an estimated 8,900 new jobs in Texas alone, and 140,000 jobs nationwide.
“Credit unions make a real difference for small businesses,” said Dick Ensweiler, president and CEO of the Texas Credit Union League. “We have been here when Texans needed us, and we are prepared to do more. I urge our senators to vote for Texas jobs and vote for this bill.” For ninety years there was no cap on credit union business lending; the only group opposing the bill is the banking lobby.
About Texas Credit Union League
The Texas Credit Union League is the state trade association serving more than 500 credit unions in Texas. Organized in 1934, the Texas Credit Union League supports credit unions, not-for-profit, member-owned, volunteer-directed cooperatives, which in turn are owned by over 7 million members. For more information, visit www.tcul.coop.