ICBA opposes proposals to create an SBA 7(a) direct lending program. Such a program could undermine the existing successful public-private partnership SBA loan programs.

SBA direct lending is a poor and costly alternative to private sector lending and would reach fewer borrowers. Today, there is a strong network of community banks, Community Development Financial Institutions, and other lenders already in place to meet demand for small business borrowers. Further, the SBA has a poor track record in direct lending.

ICBA also opposes proposals to open SBA 7(a) participation to additional Fintechs and other unregulated, non-depository institutions. These nondepository lending institutions would be licensed, supervised, and examined by SBA, a government agency that does not have the appropriate resources to ensure that fintech lenders operate in a safe and sound manner.

ICBA will continue to support policies that ensure community banks can continue to effectively serve both American consumers and small businesses in urban, suburban, and rural communities as they grapple with these historic challenges. ICBA encourages SBA and accountability agencies within the government to investigate the rampant losses observed by SBA through lending by non-bank fintech firms.