The new head of the Small Business Administration, Isabel Guzman, is eager to overhaul the federal agency’s programs to make them more equitable and effective for all small businesses—particularly those that need the most help, Inc. reports.
“Everything’s on the table,” Guzman tells Inc. in a recent interview. “For our economy to recover,” she adds, “we have to transform our programs and services to really meet these businesses where they are at.”
The pandemic, she says, laid bare key fissures in its small business resource and financing continuum, which in a typical year supports a portfolio of $40 billion in loans but jumped to more than $1 trillion in loans and grants since the onset of the pandemic.
Here are the changes to the SBA that Guzman is working toward:
1. The lending pool could deepen. The number of approved SBA lenders, which support borrowers applying through the agency’s regular lending programs like the 7(a) and 504, may well balloon. The agency wants to maintain the numbers of lenders it had during PPP, when 5,000 additional lenders were approved.
2. Friendlier loan terms could continue. Thanks to the Economic Aid Act, which passed in December 2020, the loan terms for the SBA’s traditional loans were sweetened to include a temporary cessation of fees and interest, as well as payment subsidies. Guzman notes that these sweeteners could stick around
3. Help is on the way. It became clear during the pandemic that some borrowers were given priority from certain lenders because they had existing relationships. But others simply were too small to care about, and Guzman says she wants to change that. Read the full story.