The NCUA and the U.S. Small Business Administration announced a joint partnership to help small businesses and credit unions connect for better access to capital and to boost awareness of SBA programs.
"This is a tremendous opportunity for credit unions and small business owners," NCUA Board Chairman Debbie Matz said. "SBA-guaranteed loans made by credit unions provide needed capital for existing small businesses and start-ups that might have difficulty obtaining loans from other institutions."
Matz said SBA loans rank among credit unions' safest loans.
"There is a vast untapped capacity for credit unions to make more SBA loans. This initiative will help us unlock that capacity and put it to work for credit unions, their members and their communities," she said.
According to the NCUA, the Memorandum of Understanding signed by the two agencies contained initiatives set to take place over the next three years, including webinars, examiner training on SBA programs, media outreach and data resources.
The NCUA and the SBA scheduled a joint webinar for credit union officials and NCUA staff on SBA lending March 4 at 3 p.m.
The NCUA said the guaranteed portions of SBA-backed loans do not count against credit unions' statutory cap on member business lending. The agency also said the SBA guarantees range from 50% up to 90% of the principal of each loan, depending on the type.
"It's about to become easier for credit unions to help their members finance small business ventures. It's a natural fit; credit unions are some of this nation's most trusted mission-based lenders," SBA Administrator Maria Contreras-Sweet said.
"This partnership will have another benefit in that it will serve the needs of encore entrepreneurs, people who've worked all their lives in one career who decide to strike out on their own. SBA will backstop the loans, and credit unions' long-term relationships with their members put them in an ideal position to assess their character and creditworthiness."
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