Expanding Access to Affordable Credit for Small Businesses Act

To require the Small Business Administration to license new lending institutions to make loans under section 7(a) of the Small Business Act, and for other purposes. 1. Short title This Act may be cited as the Expanding Access to Affordable Credit for Small Businesses Act 2. Licensing of small business lending companies (a) In general Section 7(a)(17) of the Small Business Act ( 15 U.S.C. 636(a)(17) (17) Licensing of small business lending companies (A) In general The Administration shall authorize lending institutions and other entities, including small business lending companies, non-Federally regulated lenders, and non-depository lending institutions, in addition to banks to make loans authorized under this subsection. (B) Criteria In authorizing lending institutions and other entities under subparagraph (A), the Administration shall ensure that each such institution or other entity— (i) provides an independent audit by a third party or internal independent audit department that examines adherence to all applicable Federal anti-money laundering, terrorist financing, sanctions, and financial crimes laws and regulations; and (ii) has in place a compliance program that is designed to be in conformance with all relevant anti-money laundering laws and regulations expectations described in the Federal Financial Institutions Examination Council Bank Secrecy Act/Anti-Money Laundering Examination Manual and other regulatory guidance, including— (I) an annual financial crimes risk assessment; (II) designation of an anti-money laundering Officer; (III) a customer identification program; (IV) customer due diligence and enhanced due diligence; (V) suspicious activity monitoring and reporting; (VI) information sharing; (VII) record retention; (VIII) sanctions implemented by the Office of Foreign Assets Control; (IX) annual employee training, including general training and job-specific training; and (X) monitoring and testing. (C) Prohibition on moratorium The Administration may not impose a moratorium on the licensing of lending institutions described in subparagraph (A). (D) New applicants Not later than 1 year after the date of enactment of the Expanding Access to Affordable Credit for Small Businesses Act (E) Reports Not later than 1 year after the date of enactment of the Expanding Access to Affordable Credit for Small Businesses Act (i) the number of lending institutions and other entities described in subparagraph (A) that applied to make loans under this subsection; (ii) the number of lending institutions and other entities described in subparagraph (A) that the Administration approved to make loans under this subsection; (iii) if the application of a lending institution or other entity described in subparagraph (A) was denied, the reason why for each such denial; (iv) the number and total amount of loans made by under this subsection by lending institutions and other entities described in subparagraph (A); and (v) demographic information on the recipients of the loans described in clause (iv). (F) Rule of construction Nothing in this paragraph shall be construed to provide authority to the Administration to regulate small business lending companies, non-Federally regulated lenders, or non-depository lending institutions. . (b) Funding There is authorized to be appropriated for the Office of Credit Risk Management of the Small Business Administration such sums as may be necessary to conduct oversight of lenders authorized under section 7(a)(17) of the Small Business Act ( 15 U.S.C. 636(a)(17)

Summary: Expanding Access to Affordable Credit for Small Businesses Act This bill establishes rules related to the authorization of lending institutions and other entities (including small business lending companies, non-federally regulated lenders, and non-depository lending institutions) to make loans under the 7(a) Program of the Small Business Administration (SBA). Under the 7(a) Program, the SBA provides business loans and loan guarantees to small business borrowers who cannot obtain credit elsewhere on reasonable terms and conditions. Specifically, the SBA must ensure that these lending institutions and other entities (1) provide an independent audit that examines adherence to all applicable federal laws and regulations regarding anti-money laundering, counterterrorist financing, sanctions, and financial crimes; and (2) implement a compliance program that is designed to conform with relevant anti-money laundering laws and regulations.