(Wall Street Journal) — Small businesses received more government-backed loans last year than ever before. Even so, access to capital remains a major hurdle for a significant number of U.S. entrepreneurs, new data show. A record $19.6 billion were issued through the Small Business Administration’s flagship program in fiscal 2011, the government agency reported Wednesday. Those funds, however, were distributed to 53,706 businesses, roughly the same number as in 2010. SBA loans, which are issued through banks, are intended to help small firms grow and hire. A portion of each loan is guaranteed by the federal agency to cover a bank if a borrower defaults, thereby reducing the bank’s risk. In turn, the agency reasons that the program encourages banks lend to more money to more small businesses.
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