From the Responsible Business Lending Coalition

Statement on behalf of the Responsible Business Lending Coalition, a network of nonprofit and for-profit lenders, investors, and small business advocates, in support of New York State’s Small Business Truth in Lending Act.

​The Responsible Business Lending Coalition (RBLC), the only cross-sector coalition whose members  represent nonprofit and for-profit lenders, investors, and small business advocates,  commends the passage of the New York State Small Business Truth in Lending Act. The RBLC thanks the leadership of Assemblyman Zebrowski and Senator Thomas for introducing Assembly Bill A10118 and Senate Bill S5470 and bringing common-sense transparency standards to small business financing in New York.

This legislation represents the nation’s strongest commercial lending disclosure requirements, just as small businesses need protection the most. Clear and concise language from lenders will allow entrepreneurs to easily shop and compare financing offers, thereby empowering them to make the best financial decisions for their businesses. When the law is implemented, New York small businesses are expected to save between $369 million and $1.75 billion annually.

“During a difficult time for small businesses, this is much-needed good news. Truth-in-lending will empower small businesses to choose the best financing for them. And healthy price competition will reward innovations that provide better loans and lower rates. During the last economic crisis, we learned a valuable lesson that must guide us today: alignment of incentives between borrowers and lenders benefits all of us. This Small Business Truth in Lending Act does just that!” — Richard Neiman, Head of Public Policy of LendingClub, and former New York State Superintendent of Banks

“As the world’s largest online marketplace for small business financing, Funding Circle believes a free and fair market operates most efficiently when there is transparency in pricing, terms and conditions. When a small business has all of the necessary information up front including the annual percentage rate (APR), they can compare financing products and make informed decisions that are best for their business.” — Ryan Metcalf, Head of Regulatory Affairs of Funding Circle U.S.

The news also comes as a welcome victory for minority business owners who often struggle with securing affordable financing for their businesses. Research from the Federal Reserve Bank shows that Black and Hispanic business applicants turn to online lenders at a higher frequency than White applicants, with online lenders being the second most popular source of financing for Black and Hispanic entrepreneurs. For the 26,000 minority small business owners in New York, cumulative annual savings is expected to be in the hundreds of millions.

“The unacceptable reality is that New York’s Black-owned businesses face disproportionate challenges accessing capital on affordable terms. Assemblyman Zebrowski and Senator Thomas’ New York State Small Business Truth in Lending Act will help level the playing field by ensuring that our small businesses are not misled into taking on unaffordable debt due to misleading disclosures. The UpState New York Black Chamber of Commerce applauds the legislature for protecting our business owners from deception and setting a strong national standard for lending transparency.” — Anthony Gaddy, Co-Founder/President and CEO of the Upstate New York Black Chamber of Commerce

“Community Development Financial Institutions are committed to offering loans in a fair, affordable and transparent manner. Unfortunately, some lenders have made it hard for small businesses to compare the true cost of their offers. CDFI Coalition members around the state are pleased to see this measure will require lenders to disclose annual percentage rate (APR) and repayment terms and help New Yorkers make better borrowing decisions.” — Linda MacFarlane, Chair, NYS CDFI Coalition.

The New York State Small Business Truth in Lending Act builds upon similar legislation passed in California on an overwhelming bipartisan basis. That law was inspired by the Responsible Business Lending Coalition’s Small Business Borrowers’ Bill of Rights, a list of fundamental financing rights that all small businesses deserve. The RBLC urges Governor Cuomo to move swiftly in signing this key legislation into law for the protection and benefit of New York’s small businesses.###

Responsible Business Lending Coalition
The Responsible Business Lending Coalition (RBLC) is a network of nonprofit and for-profit lenders, investors, and small business advocates that share a commitment to innovation in small business lending and serious concerns about the rise of irresponsible small business lending. The coalition created the Small Business Borrowers’ Bill of Rights, the first cross-sector consensus on the rights that small business owners deserve and what financing providers, brokers and lead generators can do to uphold those rights. Over 100 small business lenders, brokers and lead generators, and advocacy organizations have endorsed these standards. Members of the Responsible Business Lending Coalition include Accion Opportunity Fund, Community Investment Management, Funding Circle, LendingClub, Opportunity Finance Network, Opportunity Fund, Small Business Majority, StreetShares, and the Aspen Institute. For more information, visit