Hot Zounds! Uncle Sam's Giving Away Money! (Almost!)

What's All the Commotion?

Aw phooey! I was just about to enjoy a nice afternoon nap when I heard the news. Turns out Uncle Sam—that skinflint—is actually gonna help us small business owners! The U.S. Small Business Administration led by Isabel Casillas Guzman (no relation to Gus Goose I presume) is planning to unleash new government backed credit lines up to a WHOPPING $5 million! Five million clams you say? That's enough to buy a whole lotta orange juice... and maybe even expand my lemonade stand!

A Pilot Program That Doesn't Involve Flying!

This ain't no ordinary handout folks. This is a 'working capital pilot program'. Sounds fancy right? Apparently it's supposed to be more appealing to both the lenders AND the borrowers. Guzman says small businesses need this to help rebuild infrastructure and expand orders. Seems like they are trying to offer something better than the SBA Express loan and CapLines which were about as clear as mud.

SBA to the Rescue! (Maybe...)

The SBA's 7(a) loan program is supposed to encourage lenders to give loans to us little guys. Last year they backed over 57,000 loans worth $27.5 billion! That's a lot of dough! But here's the rub: their revolving lines of credit haven't been as popular as they hoped. Why? Well some of their other offers were about as useful as a screen door on a submarine!

Simpler? Affordable? Don't Get Your Feathers in a Ruffle Just Yet!

Guzman says this new program is supposed to be 'simpler' and offer a more 'affordable working capital line'. They're trying to avoid us relying on credit cards which let me tell you can be a real headache! But how affordable is it? Well there's an annual fee and interest rates based on the prime rate plus 3% to 6.5%. That could be around 12% to 15% today! Ouch! But hey at least they are giving it a shot. Maybe things will work out for the best.

The Nitty Gritty (or How to Get Your Claws on the Cash)

These new credit lines will let you fund specific projects or borrow against your assets. If you need more than $150,000 the SBA will guarantee 75% of the loan. If it's less than that they'll guarantee 85%! That means lenders are less likely to lose their shirts if we can't pay back the money. 'In an environment of higher interest rates we want to make sure that the SBA is an option for more businesses,' Guzman quacked... I mean said.

So What's the Catch?

Well there's always a catch ain't there? But if you're interested head to the SBA's website or their pre screening lender platform. Just remember folks read the fine print! And don't go spending all the money on bubblegum and firecrackers! Unless...you're running a bubblegum and firecracker business! Then go for it! Just don't say I didn't warn ya! Now if you will excuse me I have a date with Daisy. Oh boy oh boy oh boy!