ICBA urging grassroots pushback against SBA direct lending plan

ICBA is calling on community bankers to continue the campaign opposing proposed changes to the SBA 7(a) loan program contained in the House budget-reconciliation bill.

Grassroots: Community bankers can use ICBA’s Be Heard grassroots action center to urge Congress to oppose a plan that would authorize the SBA to issue direct 7(a) loans, which would harm small businesses and taxpayers.

Letter: In a letter last week to House and Senate leaders, ICBA said:

• The proposal may not comply with the Byrd Rule because its budgetary effects are incidental to the nonbudgetary components of the provision, so it should not be considered under reconciliation procedures.

• The SBA canceled a previous direct lending experiment because the subsidy rate was 10 to 15 times higher than that for loan guaranty programs.

• With the PPP ending successfully, the SBA has already guaranteed a record $30.1 billion in 7(a) lending in fiscal 2021.

More: ICBA has spoken out against the proposal in a news release, previous letter to committee leaders, and testimony before the House Small Business Committee.