Loan Management Software for Small Business
A group of Senate Republicans have put forward a bill that would eliminate the Small Business Administration (SBA) as a stand-alone agency and combine its functions with that of the Commerce and Labor departments, creating a new “Department of Commerce and Workforce”. And while it may seem that a bill written by members of the minority party will make little headway in the Senate, a recent article on Bloomberg Businessweek suggests that this may not be the case.
The proposal, supported by Senators Richard Burr (R-NC), Dan Coats (R-IN) and James Inhofe (R-OK), seeks to merge the different departments as a way of streamlining the federal government. It’s not a new idea—President Reagan discussed eliminating the agency, but never took action. But now it seems that the idea may have bipartisan support. The Businessweek article mentions that President Obama actually floated a similar idea to combine agencies in 2012.
Though this proposal may save taxpayer dollars by eliminating federal positions, it is unclear how it will affect small businesses and their lenders. At present, one of the goals of the SBA is to guarantee loans and take on some of their risk in order to ensure that small business owners are getting access to the credit they need to stay operational and eventually expand. As a stand-alone agency, the SBA can focus on this goal. However, as part of a larger department, this focus may become lost in the shuffle.
In such a situation, it may fall to individual lenders to use loan management software to maintain an acceptable level of risk in their portfolios, while still doing their best to serve their customers.