Small business owner in Baltimore, I started my own venture following the footsteps of my grandparents. But, when I sought funding from a company I believed to be trustworthy, I realized that the lack of regulatory protections in Maryland left me vulnerable to losing the business that had taken me over a decade to build.
The financing company provided pricing quotes that were not transparent and did not accurately reflect the total cost of the loan. Despite consumer loans being required to disclose APRs since 1968, there is no such transparency required when it comes to lending to small businesses in Maryland. This has led to financing companies offering business loans with undisclosed APRs that can reach up to 300%, often targeting business owners of color like myself with aggressive marketing tactics.
Every day, I am bombarded with calls, texts, and emails from these companies which distracts me from focusing on growing my business. To address this issue, House Bill 574 aims to establish basic price transparency standards for business financing, similar to those already in place in states like New York and California. Unfortunately, the bill is currently being held up in the House Economic Matters Committee. Last year, high-price financing companies were able to kill the bill but it deserves to be voted on this year.
As a small business owner in Baltimore and member of our community’s economic well-being, I urge lawmakers to pass this bill that will protect entrepreneurs like myself from predatory lending practices that put our businesses at risk.
