In Michigan and North Carolina Federal Small Business Funding Starts Being Used

The states of North Carolina and Michigan are the first to start to lend money to small businesses. The funds are from a new federal program that is part of the Small Business Act is jobs. The Act was signed into law by President Obama in September. The federal program will hand out 1.5 billion small businesses across the country, the repayment period are worth receive loans to help. Loans were hard to come by these companies during a time when banks are tightening loan underwriting standards.

While the federal government has put in only $ 1500000000, the program has the goal of helping to finance an estimated $ 15000000000 for small businesses nationwide. The funds will be encouraged as an incentive to credit and certainly meant ten times the amount of stimulus. North Carolina will receive $ 46,100,000, Michigan where lending increased even more, will receive $ 79.1 million. Other states are still waiting to find out how much they will get.

A similar program in Michigan helped to shape this federal program. Michigan program uses a sum of $ 20,000,000, which was for a total of $ 191,000,000 in secure business loans.

The overall objective of the program is to help increase job. "As a small business without access to credit, they can not create jobs," U.S. Treasurer Rosie Rios said in announcing the funding at Detroit metal stamping plant.

Both the states of Michigan and North Carolina are concerned with high unemployment. In the last ten years, Michigan has seen a steady pace when it comes to job losses. The state of unemployment is the highest in the nation and in November last year were 12.4% of them. The same month, North Carolina saw an increase in job losses. There was unemployment in November to 9.7%.

"The expansion of access to credit for small enterprises is essential for the acceleration of North Carolina economic recovery," North Carolina Governor Beverly Perdue, a Democrat, said in a statement.

All states and the District of Columbia may participate in the program. In order to qualify each state to prove that receive federal funds for every dollar, ten dollars for small business loan is secured.