MADISON, Wis. (9/17/15)--An entrepreneur states the case for increasing the credit union member business lending (MBL) cap in a Forbes online commentary.
Rohit Arora, co-founder of Biz2Credit, an online small business financing platform that uses technology to streamline the funding process, offers his support for the Small Business Lending Enhancement Act, introduced by Sen. Rand Paul (R-Ky.) and Sen. Sheldon Whitehouse (D-R.I.).
The legislation would increase the MBL cap for credit unions to 27.5% of assets from 12.25%.
A similar bill, the Credit Union Small Business Job Creation Act (H.R. 1188), has been introduced in the House by Reps. Ed Royce (R-Calif.) and Gregory Meeks (D-N.Y.).
“This legislation is long overdue,” Arora writes. “Now with more digitization as well as impending interest-rate hike, credit unions will need to invest resources and show more commitment for this bill to make a material impact in credit unions increasing their market share in the small business lending space.”
Arora cites CUNA statistics that estimates that passage of the legislation would significantly improve the economy. If enacted, credit unions could lend an additional $16 billion to small businesses in the first year, helping them to create more than 150,000 new jobs, according to CUNA’s most recent estimates.