WASHINGTON – United States Senate Committee on Small Business and Entrepreneurship Chair Mary Landrieu, D-La., and Ranking Member Olympia J. Snowe, R-Maine, today introduced an amendment to the Credit CARD Act of 2009 that would expand both the underlying legislation and the Truth in Lending Act’s credit card provisions to include small businesses with 50 or fewer employees. The amendment would also increase the current credit limit from $25,000 to $50,000 to adjust for inflation and the increasing number of small businesses with higher credit limits.
“Since the late 1990s, small businesses have steadily increased their reliance on credit cards as one of their largest sources of financing,” Chair Landrieu said. “The current lending crisis, however, has only exacerbated this trend. According to the National Small Business Association, the number of small businesses reporting that they use credit cards as a source of financing has increased by 18 percent just since August– from 41 percent to 59 percent. The National Federation of Independent Businesses estimates that the number of small businesses using credit cards could be as high as 85 percent. At the same time, many small businesses have reported having their interest rates increased and their credit limits cut. This amendment will help protect small business owners that use business credit cards or personal credit cards to finance their businesses, preventing layoffs and encouraging growth.”
“America’s small businesses – the engine that drives our nation’s economy – deserve to be shielded from potential credit card abuses that could cripple their operations,” said Ranking Member Snowe. “Our amendment addresses a key deficiency in the CARD Act by extending critical protections to small businesses with 50 or fewer employees that use a credit card. The fact is, according to the National Federation of Independent Business, 85 percent of small business owners have one or more credit cards that they use for business purposes. Given this statistic, it is imperative that we stand up for small business owners in this bill, and our amendment ensures that adequate safeguards are similarly offered to our nation’s job creators.”
In addition to Sens. Landrieu and Snowe, he following Senators have cosponsored the amendment: Sens. Benjamin L. Cardin, D-Md., Sharrod Brown, D-Ohio, Jeanne Shaheen, D-N.H., and Maria Cantwell, D-Wash.
The following organizations have signed a letter supporting the amendment: American Beverage Licenses, American Society of Travel Agents, Center for Responsible Lending, Consumer Action, Consumer Federation of America, D?mos: A Network for Ideas & Action, Food Marketing Institute (FMI), National Association of College Stores, National Association for the Self-Employed, National Association of Theatre Owners, National Community Reinvestment Coalition, National Consumer Law Center (on behalf of its low income clients), National Federation of Independent Businesses (NFIB), National Small Business Association (NSBA), Petroleum Marketers Association of America, Service Employees International Union, U.S. Hispanic Chamber of Commerce, U.S. PIRG and U.S. Women’s Chamber of Commerce.