Minorities Need Equity Access, Not SBA Loans
(Businessweek) — The Small Business Administration recently announced two new programs that will increase lending to businesses in disadvantaged areas and to those headed by minorities and women. Beginning in mid-March, Small Business Advantage and Community Advantage will allow mission-based financial institutions to issue SBA-guaranteed loans of up to $250,000. “These new ‘Advantage’ initiatives are aimed directly at getting more loans into these markets so these small business owners can get the capital they need …,” SBA Administrator Karen Mills explained in a press release. While I agree with Mills that a lack of capital deters many minority business owners from starting businesses, I don’t think further loan programs are the answer.