The 10,000 Small Businesses Voices Community Calls on Policymakers to Halt the Federal Reserve’s Proposed Rule, Basel III Endgame
Over 3,000 small business owners sign a comment letter asking the Federal Reserve to abandon the regulation as it will hurt small businesses.
To the Federal Reserve:
We are America’s small businesses.
We are builders, manufacturers, restaurant owners, and more. We run coffee shops, cleaners, corner stores and child care centers. We are the diverse entrepreneurs of 10,000 Small Businesses Voices, and we never stop working to create jobs and strengthen our local economies. On behalf of our community of more than 14,000 small businesses in all 50 states, Puerto Rico and the District of Columbia, we respectfully submit this letter to express our serious concerns about your proposal to require U.S. banks to significantly increase the capital they must hold.
We rely on America’s banks to operate and grow our businesses, support our employees, and strengthen our communities.
We are already struggling to access capital – according to a September 2023 survey of our community, 70% of us who have applied for a new loan in the past year have found it difficult to access capital. And we worry these new proposals will make getting access to capital even harder. Even those of us who rely on smaller and community banks will almost certainly experience a further tightening of credit conditions.
The proposed cumulative capital requirements for lending will make it more expensive for banks to loan to small businesses, and those added costs will no doubt be passed on to us.
Banks already treat small businesses as risky borrowers, and we are concerned that the new calculations in this proposal will make borrowing costs unaffordable and capital inaccessible. The timing of this proposal couldn’t be worse. In fact, the Federal Reserve acknowledged recently that the share of households reporting that it is harder to obtain credit today than one year ago hit a new high in August. According to our September 2023 survey,
- 84% of small businesses are concerned this proposal will negatively impact their ability to access capital in an already difficult market,
- 76% said not being able to access affordable capital has negatively impacted their business, and
- 73% said rising interest rates are having a negative impact on their business.
Entrepreneurial risk-taking is something we should always value and protect here in America.
We are asking the Federal Reserve to allow us to remain competitive and forward-leaning.
We ask you to consider the consequences this rule might have on our ability to access capital and grow our small businesses.
Click here for an accessible PDF
Learn more about how the Federal Reserve’s Basel III Endgame will affect small businesses