The Treasury Department’s release of its signature $30 billion small-business lending program is being questioned and looked at with dubbed eyes by Republicans like Sen. Orrin Hatch, who holds a high rank on Senate Finance Committee. The timing of the roll-out is being questioned as there are warning signals of the Treasury receding from its assertion that it is doing everything to avoid breach of federal debt limit.
Senator Hatch in his letter to Timothy Geithner, the Treasury Secretary, has expressed his astonishment that the Treasury department is not waiting any longer to distribute funds even after the $14.29 trillion debt ceiling has increased. The decision to spend the money actually undermines Treasury claims to do everything possible to maintain flexibility.
In September 2010, the Small Business Jobs Act got signed by President Barack Obama. It made available $30 billion small-business-lending fund, aimed at increasing loan grants to small companies. Till date 23 banks have already received total of $337 million from this flagship program for lending out to small businesses. The treasury announced that it is going to make additional funds available in coming weeks.
A failure to increase debt ceiling would result in the threat of a default on US debt and the consequent inability to send out Social Security Checks. It seems to be careless to be awarding hundreds of millions of dollars with assurances that more spending has been lined up and is coming.
The authorization for grant of new loans expires on Sept 27. Hatch also seems to be concerned that Treasury is now left out with 62 days for spending out remaining $ 29.6 billion available in small business lending program.
This article was submitted by Raj Tulshan, Director of Business Development of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to