ICBA to Congress: Preserve community bank SBA lending

ICBA called on Congress to reject proposed changes to the SBA 7(a) loan program that would displace community bank SBA lending.

Details: In testimony before the House Small Business Committee, Bank of Charles Town, W.Va., President and CEO Alice Frazier said experimenting with SBA direct 7(a) lending—in which the agency has a poor track record—would jeopardize access to credit for small businesses.

More: In her testimony, Frazier noted:

  • Establishing a direct lending program to compete with 7(a) experts would risk diminishing program participation, increase fraud, and put taxpayer dollars at risk.
  • While the Paycheck Protection Program displaced 7(a) lending in 2020, the SBA has already guaranteed a record $30.1 billion in lending in 2021—contradicting claims that 7(a) lending has declined.

Background: An ICBA-opposed provision of the $3.5 trillion budget-reconciliation package would provide $4.5 billion to the SBA to make direct 7(a) loans of $150,000 or less, which ICBA spoke out against in a recent letter to lawmakers.

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