It is an understatement to say the 2024 Presidential Election between Kamala Harris and Donald Trump is highly anticipated for so many reasons and how it will impact the country and the world. But how will it affect business lending and fintech?
The following are some policies, promises, economic data, and facts from the Kamala Harris and Donald Trump campaigns that stakeholders in the business lending landscape should be aware of as they may directly or indirectly affect them. This will be as independent as possible, but someone will always take something as biased, and if so, please comment below to start a discussion. The most important thing is that you vote, as only 66% of eligible voters cast their vote in 2020.
(In alphabetical order by last name)
Kamala Harris
Proposing to increase the small business start-up tax credit to 50k from 5K. A goal of 25 million new business applications over the next four years.
More funding into CDFIs (Community Development Financial Institutions) to loan to underserved SMBs.
SBA loan enhancement with more lenders, reducing red tape to access capital, easier to refinance on 504 loans, and less stringent use of funds requirements.
Unveiled an “Opportunity Agenda” plan for Black men, which includes a proposal of forgivable loans of up to $20,000 to Black entrepreneurs and others
Crypto plans: Harris ‘will ensure owners of and investors in digital assets benefit from a regulatory framework to protect them in this market'.
Her overall economic plan will increase the deficit by est. $3 trillion according to non-partisan research.
Harris will continue to take on big banks for junk fees and other issues to protect the consumer.
She will let tax law expire which would increase taxes for earners of 400k +. However, she will cut taxes on tips, as will Trump. This could impact SMB borrowing habits.
Donald Trump
Cut corporate taxes again. Trump advocates for reducing the corporate tax rate from 21% to 20%, with a further reduction to 15% for domestic manufacturers. This could potentially increase profitability for financial institutions and possibly lead to more aggressive lending practices.
Higher and more tariffs: 10-20% tariffs across the board but with a higher tariff on Chinese goods. It would be a $3.9T potential impact on consumers, essentially a tax increase. This policy could significantly impact international finance and trade, potentially creating new challenges and opportunities in trade finance.
His plan will increase the deficit by est 7 trillion according to non-partisan research
Trump's previous administration was known for reducing financial regulations. Republican state legislatures also have been in most states when it comes to commercial finance regulation although still putting in place new laws.
It's worth noting that Trump pardoned notorious Jonathan Braun who was fined by FTC for $20 million due to predatory lending practices amongst other legal issues that resulted in prison time. The pardon interrupted an ongoing investigation into MCA funders as Braun was allegedly cooperating with them before that.
Donald Trump is openly supportive of cryptocurrencies and again regulation is not in the cards. Trump suggested creating a “strategic national bitcoin stockpile” with the goal of ensuring that America is the “crypto capital of the planet.”
He wants more influence over the Fed which could affect rates and lending.
This exercise only points out some key policy proposals or verbal promises that each
candidate has campaigned on, along with some of their history, to give you context and assist you with making your decision. Whoever wins, it's up to you to adapt and do what's best for you and your business.
Who gets your vote?
Trump
Harris
Other
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