Advocates and elected officials are spearheading campaign to combat predatory small business lending practices

For Immediate Release:
December 8, 2023


Rob Mayo 

Peter Balsam 

CHICAGO – Local business owners and community members shared their experiences with navigating a challenging post-pandemic economic environment at a Town Hall yesterday hosted by State Representative Hoan Huynh (IL-13) and Woodstock Institute, a non-profit dedicated to advancing racial equity and economic justice within financial systems. 

Small businesses play an important role in creating economic opportunities within communities, but many owners struggle to access traditional bank loans. Instead, they are forced to either use their personal savings or to turn to more costly forms of credit, including credit cards and high-interest online loans. Because the nonbank small business lenders originating many of these loans are not required to be licensed nor are they required to disclose the annual percentage rate (APR) of their loans, their borrowers run a greater risk of finding themselves the victim of predatory lending practices. 

“Small businesses are an essential part of our community, and by supporting them we are investing in the success and vitality of our state for all. I hope we can come together at this town hall to address the needs and concerns of our small businesses and discuss further how we can protect them,” said Rep. Huynh. 

“As a small business owner, especially in the healthcare field that is dominated by larger corporations, the route for financing is often to access personal lending options. Most institutions do not lend to businesses with less than 3 years of experience, which is why it is extremely helpful to have local Chicago and state organizations working to connect businesses with grants and low interest rate loans for entrepreneurs,” said Dr. Karina Fulton, an optometrist and founder of Willow Vision Health, an eye care office in Lincoln Square.

Lower-income communities and communities of color in particular face an uphill battle acquiring safe and affordable forms of small business financing. Woodstock Institute’s Patterns of Disparity: Small Business Lending in Illinois found that over a three-year period businesses located in low-to-moderate income (LMI) census tracts received only 19.3% of bank loans under $100,000 despite making up 27.0% of all Illinois businesses. Making up this deficit would require 46,648 more loans totalling $618 million. 

“Research consistently finds that small business lending by banks goes down as the percentage of Black, Brown, or low-income residents goes up. These disparities in access to safe and affordable credit continue to exacerbate our country’s racial wealth gaps by making these communities more vulnerable to predatory lending by unregulated online lenders,” said Brent Adams, Senior Vice President of Policy and Advocacy at Woodstock Institute. Adams is also the former chief financial regulator for the State of Illinois (2009-2012). 

Presenters also discussed current efforts to aid small businesses such as the Back to Business New Grant Program and HB3064, the Small Business Truth in Lending Act.

HB3064 is championed by Rep. Huynh and a coalition of groups that seek to establish a regulatory framework in Illinois for “nonbank” lenders to small businesses based on a Small Business Borrowers Bill of Rights (BBOR). The BBOR has six core principles, including the right to transparent pricing and terms (including the loan’s APR), the right to non-abusive products, the right to inclusive credit access, and the right to fair debt collection practices.


Woodstock Institute is a leading nonprofit organization dedicated to advancing economic justice and racial equity within financial systems through research and advocacy at the local, state, and national levels.

State Representative Hoan Huynh represents the people of Illinois’ 13th State House District, covering Northside Chicago and the lakefronts (includes Uptown, Andersonville, Buena Park, Sheridan Park, Ravenswood, Wrigleyville, Lake View, Southport, Lincoln Square, Bowmanville, Winnemac, Arcadia Terrace, Budlong Woods, and West Ridge).