[Congressional Record Volume 165, Number 130 (Wednesday, July 31, 2019)]
[Senate]
[Pages S5252-S5253]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CARDIN (for himself and Ms. Duckworth):
  S. 2360. A bill to establish an Office of Emerging Markets within the 
Small Business Administration that will strengthen the development of 
small business concerns in emerging markets, including those owned by 
women, minorities, veterans, and those located in rural areas, and for 
other purposes; to the Committee on Small Business and 
Entrepreneurship.
  Mr. CARDIN. Mr. President, today I am introducing the Unlocking 
Opportunities in Emerging Markets Act, which establishes an Office of 
Emerging Markets (OEM) within the Small Business Administration's (SBA) 
Office of Capital Access to ensure that SBA's access to capital 
initiatives address the specific needs of entrepreneurs in underserved 
domestic emerging markets.
  Capital is the lifeblood of small businesses, but for women, 
minorities, veterans and other underserved entrepreneurs, access to 
capital remains the key roadblock to owning and operating a successful 
business.
  The challenges that underserved entrepreneurs face are historic and 
pervasive with minority and women entrepreneurs, for example, having 
less wealth from which to fund new businesses.
  Black families have $17,150 in wealth and Hispanic families have 
$20,720 in wealth, while White families have $171,000 in wealth. 
Similarly, women have $3 in wealth for every $10 men have.
  These historical barriers are compounded by systemic inequality in 
the capital markets. Minority-owned business are two to three times 
more likely to be denied credit; more likely to avoid applying for 
loans, based on the belief that they will be turned down; and more 
likely to receive smaller loans and pay higher interest rates on the 
loans that they do receive. Rural businesses owners often face an 
uphill battle to secure funding for their startups. And women are 
significantly

[[Page S5253]]

less likely than men to be approved for a business loan and are more 
likely to experience funding gaps.
  SBA was created to solve these very problems, but instead of being a 
solution, lending patterns in the agency's largest loan programs mirror 
these trends. During Fiscal Year 2018, only 4.5 percent of all loans 
approved by SBA's highest volume loan program--7(a)--went to Black 
entrepreneurs. Another 8.5 percent went to Hispanic entrepreneurs, 
while 59 percent went to white borrowers.
  Despite these challenges, SBA does not have the coordinated effort 
required to address them. In multiple hearings in the Small Business 
Committee, SBA has not been able to explain how they are addressing 
these urgent issues. By creating OEM, and empowering a Senior Executive 
Service level director to lead the office, we in Congress can ensure 
that SBA is giving the problems that underserved entrepreneurs face the 
attention and resources they deserve.
  Eliminating disparities in the capital markets for underserved 
business owners is not just the right thing to do, it will spur growth 
in the American economy.
  In the years since the Great Recession, minority-owned small 
businesses have been driving the growth of small business formation in 
spite of the significant headwinds they face. Just imagine what they 
could do if SBA was laser focused on removing some of those headwinds. 
SBA has helped level the playing field for underserved communities in 
government contracting, and entrepreneurial development, but access to 
capital is the only major area where there is no office specific to the 
needs of underserved communities.
  I urge my colleagues to join me in support of this critical piece of 
legislation, so SBA can begin making the concerted effort required to 
help more underserved entrepreneurs overcome barriers, start successful 
businesses, and create jobs.
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