If women feel that running a business has been a challenge, there may be some respite coming soon. U.S. Sen. Maria Cantwell, (D-Wash), Chairwoman of the Senate Committee on Small Business and Entrepreneurship and several other Senators have introduced new legislation. The bill is designed to provide female entrepreneurs with better and more equal treatment in starting and growing a business.
A History of the Issues
While women own a whopping 10.6 million businesses in the US, they still find it harder to secure business loans than men do. Out of every $23 lent to small businesses, only $1 goes to a woman-owned business, according to a report issued(PDF) by the committee. Women entrepreneurs are seeing this challenge at every level of financing and investment, from micro loans and venture capital to conventional loans.
Women also historically haven’t had equal access to government contract opportunities. Twenty years ago, Congress set a government-wide goal of awarding 5% of government contracts to women-owned businesses. But guess what? That goal has never been achieved. And so women keep missing out on $4 billion in federal contracts each year.
Another project the U.S. government has left fall by the wayside is the growth of the Small Business Administration’s Women’s Business Centers (WBC), designed to provide women with training and additional resources. Without funding, these centers have stagnated and haven’t fulfilled their potential in serving women nationwide.
All of these factors have been deterrents to more women jumping into business ownership. And all are points the proposed “Women’s Small Business Ownership Act of 2014” would address.
What The Bill Will Do
If passed, here are some of the specific issues the bill is designed to address.
Improve Lending Opportunities for Women Owned Businesses
The Act would expand and improve the SBA’s microloan and intermediary lending program to reach women who need $50,000 or less for their businesses. It would also enable women who need more — up to $200,000 — to get better access to these loans. Microlenders would have a higher lending cap of $7 million, which would allow them to approve more loans to women.
Boost the Women-Owned Small Business Federal Contract Program
This would put women-owned businesses on equal ground with other disadvantaged groups when bidding on federal contracts and move Congress closer to its 5% goal.
Increase Funding for the Women’s Business Center Program
The Act would expand services and provide more counseling and training to female business owners, especially those in lower-income regions of the country.
Gather Data on Women-Owned Businesses
To date, there’s never been substantial research on female-run businesses. This Act would set a 2015 deadline for the SBA to determine industries where women are under-represented.
Image: Maria Cantwell website