Washington, D.C. (Sept. 16, 2021) — Independent Community Bankers of America (ICBA) President and CEO Rebeca Romero Rainey issued the following statement opposing proposed changes to the Small Business Administration’s 7(a) loan program.
“ICBA and the nation’s community banks strongly oppose legislative proposals to authorize the Small Business Administration to provide direct loans through its 7(a) program.
“As the nation’s leading small-business lenders, community banks are prolific 7(a) lenders, make up the majority of SBA lenders, and accounted for nearly 60% of Paycheck Protection Program loans. Establishing a direct lending program to compete with 7(a) private-sector experts would needlessly risk diminishing participation in the program while putting taxpayer dollars at risk.
“With a month left in fiscal 2021, the SBA has already guaranteed a record $30.1 billion in lending, with financing for the 7(a) program funded by user fees. Instead of expanding the SBA into direct lending, policymakers should update the 7(a) program’s federal credit subsidy rate to better reflect its low default rate and to help avoid disruptions to the program.
“ICBA will continue working with policymakers to maximize the effectiveness of the 7(a) program for the small businesses they serve.”
The Independent Community Bankers of America® creates and promotes an environment where community banks flourish. ICBA is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education, and high-quality products and services.
With nearly 50,000 locations nationwide, community banks constitute 99 percent of all banks, employ more than 700,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding more than $5.7 trillion in assets, over $4.7 trillion in deposits, and more than $3.6 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org