The National Association of Federally-Insured Credit Unions and the U.S. Small Business Administration on Wednesday signed a Memorandum of Understanding, which the two parties said will work to improve access to small dollar loans for small businesses across the United States.
The agreement was signed by Dan Berger, president and CEO of NAFCU, and Linda McMahon, administrator for the SBA, at NAFCU’s Congressional Caucus.
Officials said the MOU will increase the number of credit unions offering 7(a), 504 and Community Advantage SBA loans to business members.
Involving credit unions in SBA’s programs will “expand the accessibility of SBA products and ultimately strengthen small businesses,” NAFCU said in a statement, adding credit unions stand to benefit from the reduction of their risk on small business loans and from increasing the financing resources available to their small business members.
The target goal is to have 250 credit unions offer 10 or more SBA loans outstanding, the trade group explained. NAFCU said it intends to “recruit and encourage” credit unions to participate in SBA’s lending programs, in part by facilitating direct communication by SBA to NAFCU member credit unions.
