Financial technology (fintech) lenders could access some federal small business loans under bipartisan legislation introduced by US Senator Tim Scott (R-SC).
The expansion of access to credit for small businesses, S. 2690, which Senator Scott sponsored on August 10 with the original principal cosponsor, US Senator John Hickenlooper (D-CO), would increase the criteria for Small Business Administration (SBA) 7 (a) a small business lending program to include fintech lenders, which are part of an emerging industry that uses technology to improve finance operations.
“As a former small business owner, I know all too well the barriers to entry that prevent entrepreneurs from opening their shops,” said Senator Scott. “The Expanded Access to Credit for Small Business Act is just one step we can take to ensure that minority communities and people in rural America have as much access to the American dream as they do. anyone else. “
If enacted, Section 2690 would lift the moratorium on small business lending licenses (SBLC); reallocating unused COVID-19 pandemic funds from various stimulus bills to the SBA, which would oversee the new SBLCs; and requiring the administrator to verify financial soundness and compliance when reviewing new applicants to the program, according to an invoice summary provided by Senator Scott’s office.
The measure has received support from the Electronics Transactions Association, the Innovative Lending Platform Association and the Bipartisan Policy Center.