There are serious concerns that these changes to the program will be detrimental to taxpayers and small businesses alike.
MAY 11, WASHINGTON | This week, the House Committee on Small Business continued its hearings on oversight and reform at the U.S. Small Business Administration (SBA), including the effects of changes to the 7(a) lending program.
Previously reported by NSBA, SBA’s 7(a) loan program guaranteed nearly 54,000 loans worth more than $36.5 billion in 2021. After more than 40 years, the SBA is ending its moratorium on admitting new nonbank lenders, something NSBA has called for as a way to expand small-business access to capital.
While ensuring the viability and security of any new lenders to SBA’s lending portfolio is of the utmost importance, the number of 7(a) loan applications continues to increase as more Americans start a small business; however, the number of Small Business Lending Company Licenses (SBLC) licenses has remain unchanged since 1982.
The SBA rule published in the Federal Register earlier this year will allow non-depository lenders to apply for SBLCs, including fintech lenders. SBA’s new standard on lending is set to take effect today, with the goal of growing SBA’s 7(a) lending base to better serve underserved markets.
As Congress continues to evaluate the effectiveness of changes to important SBA programs, NSBA remains engaged with the small-business community to share impacts and realities with regulators.
Share your small business story with us, connect to share it with Congress, and watch and read the transcript from the hearings this week here.