Senate bill would expand SBLC program to add fintechs

Sens. John Hickenlooper, D-Colo., and Sens. Tim Scott, R-SC, have introduced a bill that would lift the moratorium on issuing new Small Business Lending Company licenses and allow fintechs to participate in the Small Business Administration’s 7(a) program.

Fintechs were given their first access to SBA lending as part of the Paycheck Protection Program.

"Our bipartisan bill will modernize the SBA’s primary loan program to help underserved small businesses grow and thrive,” Hickenlooper said in a Friday press release.

The SBLC program currently has 14 licenses.

In addition to removing the moratorium on new SBLC licenses, the bill would reappropriate unused COVID funds from various stimulus bills to be used by the SBA to provide oversight of new SBLCs and would include reporting requirements to gauge the success of the program.

The bill includes a rule of construction that would bar the SBA administrator from becoming the primary regulator of fintechs and require the administrator to check for financial soundness and compliance when considering new program applicants.