CRBF releases standards for small-business lending

WASHINGTON – The Coalition for Responsible Business Finance this month unveiled its code of ethics and best practices, designed to raise the bar for transparency and disclosures in small-business lending.
The coalition comprises businesses and service providers that advocate for the value of alternative financing opportunities for small businesses. The Washington-based group works to improve these practices that it says reflects consensus across different business practices within the nonbank small-business financing sector. These practices are a written commitment to responsible business practices, according to a press release.
“Access to capital continues to be a top priority for [the National Small Business Association], and CRBF’s efforts will help raise the bar for practices within a growing financial services sector that can help small businesses tap into much-needed alternative funding sources,” said Todd McCracken, National Small Business Association President and CEO. He’s also an advisory board member for CRBF.
The coalition says it worked in close cooperation with top small-business advocacy organizations to outline specific commitments on the biggest issues facing the industry. From this, it developed its new set of standards.
Since 2006, obtaining small-business credit through traditional bank loans has become more difficult and 69 percent of small business owners have been unable to find finances to support their businesses, according to NSBA.
“These best practices demonstrate how leaders in specialty finance can raise the bar for how small-business borrowers are treated. Arming small business owners with information through disclosure and transparency is far better than prescriptive regulatory requirements that will limit small-business choices, drive up the cost of capital and harm innovation in the industry,” said Karen Kerrigan, president and CEO of the Small Business & Entrepreneurship Council.

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