NEW YORK - J.P. Morgan Chase & Co. announced earlier this week that it would lower the interest rate it charges on a small business line of credit by half a percentage point for every new hire that the small business makes, for up to three hires, the Wall Street Journal reports.

"We encourage businesses to take advantage of the lowest interest rates in years and to create more jobs for the economy," said Jamie Dimon, chairman and chief executive of J.P. Morgan Chase.

The program applies to lines of credit up to $250,000 or existing customers who increase their lines of credit by $10,000 or more. The bank said it also would conduct seminars in 11 cities to "help local business owners increase sales and fund their businesses."

Lending to small businesses has been tight during the downturn, with bankers arguing there has been low demand from credit-worthy borrowers. However, several banks recently have begun to lend more to small businesses.

J.P. Morgan said first quarter small business loans rose 31 percent from a year earlier to $2.1 billion, and Bank of America announced it had increased its loans by 18 percent from a year earlier, to $19.4 billion. U.S. Bancorp said it has been training nearly 3,000 bank branch managers about small business lending, making it a priority for the bank.

"[Four years ago], we really weren't paying enough attention as we should to the small loans," said Kent Stone, head of consumer support services at U.S. Bancorp, adding that the number of loans it is making to small businesses is growing at double digits.