Expanding Access to Affordable Credit for Small Businesses Act

To authorize the Administrator of the Small Business Administration to license 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 lending institutions (a) In general Section 7(a)(17) of the Small Business Act ( 15 U.S.C. 636(a)(17) (17) Licensing of lending institutions (A) In general The Administration may license lending institutions to make loans authorized under this subsection. (B) Criteria In authorizing lending institutions under subparagraph (A), the Administrator shall ensure that each such institution— (i) provides an independent audit by a third party or internal audit department that examines adherence to all applicable Federal laws and regulations relating to anti-money laundering, terrorist financing, sanctions, and financial crimes; and (ii) has in place a compliance program that conforms with the requirements described in the Bank Secrecy Act/Anti-Money Laundering Examination Manual (I) an annual financial crimes risk assessment; (II) designation of an individual to serve as 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 Administrator 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 the enactment of this paragraph, the Administrator shall begin accepting applications for the licensing of lending institutions. (E) Reports Not later than 1 year after the date of the enactment of this paragraph, and annually thereafter, the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives a report that includes, with respect to the year preceding the report— (i) the number of lending institutions that applied to make loans under this subsection; (ii) the number of such lending institutions that the Administrator approved to make loans under this subsection; (iii) the reason for any denial of an application of such a lending institution; (iv) the number and total amount of loans made by under this subsection by lending institutions; 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 Administrator to regulate small business lending companies, non-Federally regulated lenders, or nondepository lending institutions, or banks. (G) Definitions In this paragraph: (i) Bank The term bank (ii) Lending institution The term lending institution (iii) Non-Federally regulated lender; small business lending company The terms non-Federally regulated lender small business lending company . (b) Authorization of appropriations 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 lending institutions and other entities as described under paragraph (17) of section 7(a) of the Small Business Act ( 15 U.S.C. 636(a)

Summary: Expanding Access to Affordable Credit for Small Businesses Act This bill establishes rules related to the authorization of lending institutions (including banks, 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 guaranties to small business borrowers unable to obtain financing elsewhere. 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.