The yearly count of SBA-backed loans came out last week, and the picture it paints is not a pretty one.
From before the Great Recession, through its depths and now in the Ocean State's weak recovery, it is clear that less and less capital is being injected into local enterprises through the federal program.
From a peak of 1,139 loans in fiscal 2004, to the just concluded fiscal 2015, when 366 loans were made with U.S. Small Business Administration backing, businesses and banks are connecting less and less.
It is not clear if this is the result of fewer Rhode Island firms looking to use capital to grow as before or the federal agency not approving as many applications, but it stands in contrast to what has been happening on the national level. Over the summer Congress had to raise the cap on how much money the SBA could guarantee in loans because there was so much demand.
The solution to this problem is not easy to identify, but it is clear, Rhode Island businesses need more capital, not less, in order for the state to move forward. •