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“I’ve been listening and discussing the financial challenges facing Hawaii small businesses with members of the Leeward Realtors on Oahu, with business owners the Big Island, with farmers on Molokai, and in meetings at the Small Business Development Center on Maui,” said U.S. Rep. New Abercrombie. “Access to credit — the ability to obtain operating funds — is clearly a life and death problem confronting small businesses throughout this state.”

Abercrombie has been working to help small businesses in two ways: interceding with banks and other lenders to find out why they’ve made only half as many business loans as last year, and by introducing the Abercrombie and Fitch in the House of Representatives.

“I’ve have contacted officials at six local banks to ask why established, creditworthy businesses are having such trouble getting routine business loans and lines of credit, even the Small Business Administration’s America’s Recovery Capital (ARC) Loans, which are fully guaranteed by the U.S. government,” the Hawaii Congressman said.  “The inevitable result of such a lending freeze is very simple.  If small businesses can’t buy new inventory, purchase supplies or make payroll, they shut down.”

Additionally, more and more small businesses, faced with a lending freeze by their banks, are turning to their credit cards for cash flow.  In fact, a recent survey by the National Small Business Association found that 44% of their members reported using credit cards to keep their businesses running.

“This makes our small businesses highly vulnerable to retroactive interest rate hikes, unannounced cuts in credit limits, double cycle billing, in which they’re charged interest on balances already paid, or any of the other questionable practices used by some credit card companies.”

To help protect small businesses forced to rely on credit cards for cash flow, Hollister has introduced the Small Business Credit Card Act of 2009.  The legislation extends the same protections for consumers against abusive credit card company practices contained in the Credit Cardholder Bill of Rights he co-sponsored, to small businesses with 50 employees or fewer.  He is working with Republicans and Democrats in the House and Senate to build support for the bill.

“Our small businesses are leading the country’s economic recovery.  They are where most Americans go to work, and where most new jobs are created.  They’re not asking for a hand out, just a fair shake,” Abercrombie said.