[{"_1":2,"_87":-5,"_88":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,75],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":72,"_74":72},"mediaId",6330928,"mediaKeyId","2313329-1c68ab1890765079ce79a776599f70cb","parentId",2313329,"title","Community lenders tell House panel data-collection and compliance costs are slowing SBA lending","audioSeconds",469,"startMs",1934000,"endMs",2403000,"viewUrl","/Search/View?dp=1&key=2313329-1c68ab1890765079ce79a776599f70cb&start=1934&end=2403","thumbnailUrl","https://assets.pipeline.soar.com/2313329-1c68ab1890765079ce79a776599f70cb/thumbnail_1934000.jpg","articleUrl","/articles/6330928/Community-lenders-tell-House-panel-data-collection-and-compliance-costs-are-slowing-SBA-lending","mediaUrl","https://secure.pipeline.soar.com/6330928-fdf57053db68f056a0c062616158847e/orig.mp4?Expires=1771169291&Signature=GWqE6e9HMc~P8zYZUoBBQaoAaEph4AD7iZoCb3sWo1lDI2bdI813-dDukFLUEC~-ZXRBGk5XWOG11ocyKrlyZ6s-UZZbUEnLAo0z6GFFmBx1utfJ9ygi3NOSkz9A7CbWgmYyIDBnnT-iX~kCcRMkW9REU90DOuPMjwUuwMKrswCZFlC24YBUZTy3GoyGRi1LtkHEhAqbc-6ryIorc5Y3ZmOm-14~ZevYcFJvKLNhiqB6Ld1r5IaAYdPnuHDrBH~RwPfPuG5u02AOGk~WFEoDWe~eN-3~I4oMs-zbuU8Je-ZPuiT~XiDbyKQT30TvLRSsBnRgodRDJYZc8RAvNVNtKQ__&Key-Pair-Id=KUT5TJCACFTXG","author","U.S. House Committee on Small Business","date","2025-02-13T05:28:52Z","article","WASHINGTON — Leaders of community banks, credit unions and a nonprofit lender told the House Committee on Small Business that recent federal reporting rules and rising compliance costs are reducing their capacity to make small-business loans and slowing access to SBA-backed credit.

“the typical turnaround time on SBA loans within our department ranges from 45 to 75 days,” Justin Hooper, CEO and chairman of the Cross Timbers region of First Financial Bank, said during the committee’s hearing. Hooper told members that his bank estimates it now spends about $11,000,000 a year on compliance and related outside services, and that implementation of the Consumer Financial Protection Bureau’s Section 1071 rule alone could cost his institution about $2,100,000 annually.

The concern extended beyond community banking. “One of the most pressing challenges … is the complexity of the SBA program requirements,” Mike Sims, chief commercial banking officer for Georgia’s Own Credit Union, said. Sims said administrative delays in SBA responses and the complexity of standard operating procedures make it “extremely difficult” for credit unions to scale SBA lending. He recommended stronger engagement by regional SBA offices to help lenders navigate the process.

Witnesses told the committee that compliance resource needs go beyond staff salaries. Hooper described additional annual expenses tied to audit, legal and technology support of roughly $3,800,000 and rising fraud-prevention costs of about $5,900,000 in personnel and technology; he said combined fraud losses and prevention spending were on the order of $8,300,000 in 2024.

Multiple witnesses singled out collection and reporting rules as unnecessary burdens. Sims called the CFPB’s Section 1071 “overly broad” and told the committee he supported Chairman Williams’s legislative effort to repeal that rulemaking. Members also discussed the FinCEN beneficial-ownership reporting rule, which committee members noted has been the subject of litigation and temporary pauses in implementation.

Committee members and witnesses differed on the policy trade-offs. Some members argued that expanded reporting is necessary to enforce fair-lending laws and to produce data on credit access for women- and minority-owned firms. Witnesses countered that the paperwork, implementation costs and privacy concerns will deter borrowers and reduce the willingness of community lenders to offer SBA products.

Several witnesses urged targeted fixes rather than wholesale program changes: faster, clearer SBA responses; more proactive regional SBA engagement; and scalable technical assistance or software support so smaller lenders can meet new reporting requirements without diverting front-line staff from lending.

The hearing produced no formal votes. Members gave witnesses five legislative days to submit written materials and questions for the record.","mediaType","Video","parentTitle","Driving Economic Growth: SBA Lending Programs and the Vital Role of Community Banks","oneSentenceSummary","Leaders of community banks, credit unions and a nonprofit lender told a House committee that federal reporting rules and rising compliance costs are diverting staff time and slowing delivery of SBA-backed loans.","taxTitle","Small Business: House Committee, Standing Committees - House & Senate, Congressional Hearings Compilation, Legislative, Federal","taxId",1829,"location","","headline","shortSummary",{"_33":76,"_35":36,"_37":38,"_39":77,"_41":78,"_43":79,"_45":80,"_47":81,"_49":82,"_51":83,"_53":84,"_55":56,"_57":58,"_59":85,"_61":62,"_63":64,"_65":86,"_67":68,"_69":70,"_71":72,"_73":72,"_74":72},6330922,"Witnesses praise SBA 7(a), 504, Community Advantage and microloan programs as on-ramps to bank lending, urge faster SBA response",1690,1213000,2903000,"/Search/View?dp=1&key=2313329-1c68ab1890765079ce79a776599f70cb&start=1213&end=2903","https://assets.pipeline.soar.com/2313329-1c68ab1890765079ce79a776599f70cb/thumbnail_1213000.jpg","/articles/6330922/Witnesses-praise-SBA-7a-504-Community-Advantage-and-microloan-programs-as-on-ramps-to-bank-lending-urge-faster-SBA-response","https://secure.pipeline.soar.com/6330922-0a20bbd8a3a72b1ffcec7f666666a6e8/orig.mp4?Expires=1771169291&Signature=fVRZlFxToIHh-5syf252x7qB3J-3QJndX6-JQw4~vpvEYFBWH3xLYlekYbay0~kjgE~kAHwsABg9kSj102bkda1VpdCjHhifC9lPQq~dGKnoaN5ntfeaA02K6-zUVG8zh7yx-PIaDLHxhZ90QVSFROvXm~U-YpXaU7wNwYkloy-f17-Ixpg8X244N8pIU-egk2PNapNjgOm0yx5dDpvoJ9TMDguP7QS-GMJxPxFirDjzB9Ux4vNFY5jpQQle24mLeXUtlLY6E6KL3tnvHndt7zPDODaCyOJlWRRcXRmKiLWzaX4a~lUAUySeM5O4u477TgvPNZS5gZfJ1raCrsg6Wg__&Key-Pair-Id=KUT5TJCACFTXG","WASHINGTON — Witnesses at a House Small Business Committee hearing described how Small Business Administration programs — including 7(a), 504, Community Advantage and microloans — have helped entrepreneurs start, scale and become bankable, while urging the agency to speed responses and strengthen regional outreach.

“The Community Advantage program is just as important to us,” Heidi DeArmond, president of MoFi, a rural certified community development financial institution, told the committee. DeArmond described a Missoula, Montana, clothing shop she helped finance: its owner was denied by a bank, qualified for a MoFi SBA microloan, successfully grew, and later refinanced with a bank. “She was able to buy the building and today she’s still there,” DeArmond said.

Witnesses offered examples and national figures. Chairman Williams and several witnesses noted the SBA guaranteed roughly $31.1 billion in 7(a) volume and about $6.7 billion in 504 volume in fiscal year 2024. Justin Hooper of First Financial Bank and Mike Sims of Georgia’s Own Credit Union described their institutions’ participation: Hooper cited PPP and other SBA activity at his bank and Sims said Georgia’s Own was the top credit-union producer of 7(a) loans in Georgia in 2024.

Franchise owner Frank Weddigrove told the committee the SBA’s 7(a) loan program “was the access to capital that gave me the opportunity” to buy and grow Camp Bow Wow locations in Texas. Weddigrove urged lawmakers to preserve a favorable joint-employer standard for franchisees; he noted Congress used the Congressional Review Act in early 2024 to overturn a prior National Labor Relations Board rule and said a federal judge later struck down the NLRB’s 2023 rule, restoring the 2020 standard.

Witnesses also described operational hurdles. Hooper said preferred-lender status and internal SBA experience help, but “the typical turnaround time on SBA loans within our department ranges from 45 to 75 days.” Sims and others said frequent changes to the SBA standard operating procedures (SOP) and slow responses from regional offices create processing delays that discourage some lenders and borrowers. Sims urged fuller use of regional SBA offices to help lenders navigate SOP changes and speed decisions.

CDFIs and microlenders described their role reaching borrowers that are “creditworthy but denied at banks,” DeArmond said, and noted low historical loss rates for Community Advantage and microloan portfolios. MoFi reported lending $40 million in 2024 and said its long-term loss rate is low; DeArmond told the committee many of her clients “graduate back into bankability” after completing a microloan or Community Advantage loan.

Members from both parties said SBA programs are critical and debated the broader policy environment, including tax provisions and regulatory moves that affect small-business cash flow and lender incentives. Several members asked witnesses to provide written follow-up to help inform legislation or administrative action.

No formal actions or votes were taken at the hearing. The committee requested additional materials and written responses from witnesses.","Community banks, credit unions, a CDFI and small-business owners told the House Small Business Committee that SBA lending programs — from 7(a) and 504 to Community Advantage and microloans — remain vital on-ramps to bank financing but are hampered by slow SBA procedures and uneven regional engagement.","actionData","errors"]

Article not found

Community lenders tell House panel data-collection and compliance costs are slowing SBA lending

Witnesses praise SBA 7(a), 504, Community Advantage and microloan programs as on-ramps to bank lending, urge faster SBA response