coalition for
regulatory innovation

Thriving small businesses are vital for a healthy economy, but many small businesses face the enormous hurdle of being unable to access capital.  The problem exists for two reasons: (1) restrictions placed on banks and other lenders who offer equity to small businesses and (2) the many federal regulations that make business processes more costly and complex.

  • The federal government’s sweeping financial regulatory standards place a heavy burden on banks, which reduce lending and increase interest rates in order to compensate for the strain.
  • Since 2010, regulatory compliance has raised costs by at least five percent for 82 percent of banks.
  • According to a leading think tank more than 20 percent of all federal government regulations affect small businesses directly.
  • If these hurdles persist, 41 percent of small businesses will be unable to grow or expand, 20 percent must reduce the number of employees, and 18 percent say they can’t increase sales.