SME Borrowers To See Refinance Opportunity

Small business owners using the Small Business Administration‘s loan program could soon catch a break on their monthly repayments.

CDC Small Business Finance is introducing a program to help small business borrowers refinance their debt, a move the firm said can help businesses regain control of their cash.

“This is a game-changer for small businesses that need breathing room to grow and create new jobs,” said CDC Small Business Finance President Kurt Chilcott in a statement on Thursday (May 26).

The not-for-profit firm links small businesses to loans provided by the federal Small Business Administration. Next month, CDC Small Business Finance will launch its refinancing service, which can lead to lower interest rates for borrowers that are fixed for 20 years.

According to the company, refinancing can lessen the burden of debt for small business owners by lowering their monthly repayments. The program can apply for commercial real estate debts and other types of business loans.

At present, the SBA is offering loans at 4.31 percent, reports said.

CDC Small Business Finance described the current economic climate as “lukewarm” for small business owners, which are expected to contribute significantly to the up to $200 billion in commercial real estate debt this year and next.

The SBA-504 Refinance program was launched in pilot phase between 2011 and 2012, the company said, and led to the refinancing of nearly $7 billion in SME debt.