Small Business Owners Meet with Federal Regulators

<figure id="attachment_40259" aria-describedby="caption-attachment-40259" style="width: 300px" class="wp-caption alignright"><a href="http://laprensa-sandiego.org/stories/empresarios-se-reunen-con-regulado…; rel="attachment wp-att-40259"><img loading="lazy" src="http://laprensa-sandiego.org/wp-content/uploads/2017/05/small-business-…; alt="" width="300" height="225" class="size-medium wp-image-40259" srcset="https://dev-laprensa.pantheonsite.io/wp-content/uploads/2017/05/small-b… 300w, https://dev-laprensa.pantheonsite.io/wp-content/uploads/2017/05/small-b… 1022w" sizes="(max-width: 300px) 100vw, 300px"></a><figcaption id="caption-attachment-40259" class="wp-caption-text">According to the U.S. Census Bureau, there are 77,000 small businesses driving the economy in San Diego County.</figcaption></figure>
Small business owners met with federal bank regulators in San Diego Friday, May 19, to explain the significant financing challenges they routinely face in starting and running their businesses. 
The meeting included representatives from the Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), Consumer Financial Protection Bureau (CFPB), Federal Reserve, and the Small Business Administration (SBA).
According to the U.S. Census Bureau, there are 77,000 small businesses driving the economy in San Diego County, creating jobs and making local investments. 
Many small business owners struggle to get traditional bank loans, putting their businesses in peril and forcing them to turn to the unregulated and often predatory online lenders that proliferated in the last decade. 
The problem is even more pronounced for businesses in low and moderate-income neighborhoods and in communities of color.
“Financial regulations and protections don’t stand in the way of small business success,” said Main Street Alliance National Director Amanda Ballantyne. “On the contrary, better regulation can substantially improve the small business lending landscape, especially for women business owners and business owners of color.”
A report earlier this year from the Woodstock Institute revealed that not only have mainstream financial institutions reduced their small businesses lending, but alternative lenders that could serve as a helpful substitute often add unwarranted burdens for small businesses in Southern California such as high interest rates, onerous terms, and poor customer service. 
Disparities like this are why San Diego small business leaders demand that the Dodd-Frank Act remain in place.
“Enforcing rules in Dodd-Frank that require lenders to report small business loan data is one step to leveling the playing field and boosting small business growth,” Ballantyne added.
The California Reinvestment Coalition, the Woodstock Institute, CDC Small Business Finance, and other San Diego small business owners joined the Main Street Alliance on Friday.
The meeting in San Diego follows a CFPB field hearing on May 10 in Los Angeles that brought together Director Richard Cordray, small business owners, and other industry representatives. During that hearing, the CFPB announced the launch of a Request for Information into small business lending.
“The federal bank regulators did a lot of listening and we talked about possible solutions to move forward,” said Brad Keiller, member of Main Street Alliance and founder and co-owner of Nomad Donuts in North Park to La Prensa San Diego. “I think this was a very positive meeting. We don’t have any concrete solutions, but there were great ideas thrown around like reinvestment, and lend more money to small businesses or at least looked at them differently.”

Author

Ana Gomez Salcido