SBA is a famous grant program in the United States of America. This is a financial solution which is aided by the federal government so that the entrepreneurs and the businessmen can finance their projects. So, this might sound too much facilitating for you. In fact, if the federal government is taking care if your business project, then, it is certainly a good sign.
But, apart from the good signs there is some problematic scenario available with this financial solution. And from that point of view, we might come upon with some criticisms which are associated with the SBA financial solution. Being a borrower or a loan seeker, you must need to know these criticisms.
Here the detailed discussion carries on in this regard.
Criticism of the SBA grant program:
The SBA grant program is associated with a lot of criticisms. Here those are discussed in details in the following:
The huge domination in the credit market:
The pioneering body actually raises the question associated with the SBA grants. And this is what happens when the good things raise questions! The SBA grant program also faced the same thing. In fact, the criticizing issues had been raised from the pioneering body named Carlo Institute. This institute basically focused on the huge domination acted by the SBA in the existing credit market. It asked a question actually.
The particular question actually seeks justification to the federal government. The justification issue here is superseding the credit market. Basically, the task of the SBA is to lend money for the business projects. And in this way, the easy grants had been available to a particular group of businessmen in US. This is the reason; other business solutions have lost the market. This dominant strategy is being criticized by Carlo.
Carlo had not stopped with one criticism only. Rather, the institute also added that the SBA grant program covers a small range of business area in the US. You might get surprised with such statements. But, practically, this is true that the SBA lenders money to small number of business projects. And even if this is a federal loan, a lot of projects are being deprived from getting financed with the federal grants.
So, the grant program might help some business project. But, such scenario is never a good sign for the total economy. And with such strategy, SBA fails to cover the financial need of the business projects dealt by vast majority in the USA.
The mission of the SBA financial program had been to ensure sustainability and stimulation of US economy. But, if it fails to cover up the business projects dealt by vast majority, this becomes a questionable issue that how far the program can be successful in meeting up the mission! In fact, SBA lets the major business projects get deprived of the solution.
So, these are the criticism associated with the SBA financial solution. Carlo Institute certainly pointed out some important issues indeed!