More community banks are getting federal approval to dole out funds to small businesses. The more funds disbursed to those business owners, the more opportunities for job growth.
Small businesses put roughly one-half of all Americans to work, according to the U.S. Treasury Department’s press statement, and they make up nearly 60 percent of gross job creation.
The Small Business Jobs Act approved nearly a year ago created s $30 billion Small Business Lending Fund. This Fund gives community banks with assets less than $10 billion to help support small businesses. The Treasury invests in each of the banks by purchasing Tier 1-qualifying preferred stock or equivalents. So far, the Treasury has disbursed a total of $1.8 billion from the program to 130 banks.
The Treasury began approving applications for the nearly 900 community banks that applied in July out of the 7700 eligible community banks. The program sent out a total of $123 million in the first wave to six community banks. The program is set to expire September 27, which will mark the one year anniversary of the enactment of the Small Business Job Act. Lawmakers and lobbying groups have been disturbed by the slow process and have urged Treasury officials to speed up the distribution of the funds. The Treasury claims it has to make sure the banks are good, and it expects to make more announcements in the coming weeks.
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