SBA Announces New Green Lender Initiative
Small businesses play a huge role in powering America’s economy, so we should make sure they have the financial resources needed to help support clean energy initiatives. Clean energy is not only necessary for climate stability—it’s also a great way for many Americans to enjoy lower energy costs. With this in mind, the Small Business Administration(SBA) announced on July 22 an expansion to its loan programs in order to support clean-energy investments, climate-friendly businesses, and a strengthened network: The new Green Lender Initiative aims to enroll more climate-focused lenders in loan programs from the SBA.
In addition, the SBA also plans to expand its 7(a) mission-driven lending through Community Advantage (CA), whose lenders “serve businesses that historically have been excluded from access to capital due to limited financial resources and many other systemic barriers” according to an SBA article. Through the Community Advantage Small Business Lending Company (CA SBLC) license, small businesses can currently take out loans up to $350,000 in specific geographic areas; this new initiative increases that amount to $500,000 and creates an application process for lenders that allows them to increase this loan size to $1 million for general projects, or $2 million for climate projects.
In a press release, Administrator Isabel Casillas Guzman noted that “The Biden-Harris Administration’s transformative Invest in America agenda is powering our economy’s transition to a clean energy future, and that includes supporting our small businesses as they do their part to help America meet the President’s ambitious and necessary climate goals. Small businesses and homes account for more than one-third of U.S. emissions, so it is vital that they are part of the solution. The SBA’s new Green Lender Initiative aligns private capital with investments in America so that more mission-driven climate lenders can leverage the SBA federal loan guarantee programs to fund the small business clean energy transition.”
Michael S. Regan, EPA Administrator, said in that same press release “The Green Lending Initiative will help advance EPA’s and SBA’s shared goals of ensuring that communities and small businesses have access to the capital they need to support and benefit from a cleaner and more sustainable economy.”
Clean energy stands to grow massively in the coming years, as it’s already a huge part of the economy. That’s why it’s so important to make sure small businesses and community lenders have the resources and financial means necessary to take part in clean-energy programs, regardless of location. Underserved communities in particular will benefit from the cost savings that come with a move toward clean energy. So, when announcements like the Green Lender Initiative come out, we’re thrilled to share the news.
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