SBA approves three new Small Business Lending Company licenses
The designation 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.
In the first expansion of the Small Business Lending Company (SBLC) in more than 40 years, the U.S. Small Business Administration (SBA) has granted three new licenses to lenders focused on historically underserved markets. The announcement follows one made in June where the federal agency said it was opening a window for new SBLC applications.
With an SBLC license, the lending organization can 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.
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.