Small Business 7(a) Loan Agent Transparency Act
Bill: H.R.4481 | Sponsor: Rep. Phillips, Dean (D-MN)
Policy area: Commerce

Summary:
Small Business 7(a) Loan Agent Transparency Act
This bill provides oversight of 7(a) loan agents, including by requiring the Small Business Administration (SBA) to establish a registration system for such agents whereby certain data may be collected and by mandating that such agents register with the system and pay an annual registration fee.
These agents provide referral and loan application services related to the SBA's 7(a) Program. Under the 7(a) Program, the SBA guarantees up to 80% of a private lender's loan to a small business borrower who cannot obtain credit elsewhere on reasonable terms and conditions.

To amend the Small Business Act to establish requirements for 7(a) 
                    agents, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Small Business 7(a) Loan Agent 
Transparency Act''.

SEC. 2. REQUIREMENTS FOR 7(A) AGENTS.

    (a) Office of Credit Risk Management Duties.--Section 47(b) of the 
Small Business Act (15 U.S.C. 657t(b)) is amended--
            (1) in paragraph (2), by striking ``and'' at the end;
            (2) in paragraph (3), by striking the period and inserting 
        a semicolon; and
            (3) by adding at the end the following new paragraph:
            ``(4) any 7(a) agent.''.
    (b) Enforcement Authority.--
            (1) Office of credit risk management.--Section 47(e) of the 
        Small Business Act (15 U.S.C. 657t(e)) is amended by inserting 
        ``or 7(a) agent'' after ``7(a) lender'' each place such term 
        appears.
            (2) Lender oversight committee.--Section 48(c)(2) of the 
        Small Business Act is amended by striking ``and any Lending 
        Partner or Intermediary participant'' and inserting ``, any 
        7(a) agent (as defined in section 47), or any Lending Partner 
        or Intermediary participant''.
    (c) Registration System.--Section 47 of the Small Business Act (15 
U.S.C. 657t) is amended by adding at the end the following new 
subsections:
    ``(j) Registration System for 7(a) Agents.--
            ``(1) In general.--The Director shall establish a 
        registration system for 7(a) agents that assigns a unique 
        identifier to each 7(a) agent and collects data necessary for 
        the Director to submit the report required under paragraph (4).
            ``(2) Requirements.--A 7(a) agent shall--
                    ``(A) register in the system established under 
                paragraph (1) before providing covered services to a 
                lender or applicant; and
                    ``(B) effective 1 year after the date of the 
                enactment of this subsection, submit an annual fee for 
                such registration to the Director.
            ``(3) Database.--The Director shall establish and maintain 
        an electronic database of the types of covered services 
        provided by each 7(a) agent.
    ``(k) Definitions.--In this section:
            ``(1) 7(a) agent.--The term `7(a) agent' means a person who 
        provides covered services on behalf of a lender or applicant.
            ``(2) Covered services.--The term `covered services' 
        means--
                    ``(A) assistance with completing an application for 
                a loan under section 7(a) (including preparing a 
                business plan, cash flow projections, financial 
                statements, and related documents); or
                    ``(B) consulting, broker, or referral services with 
                respect to a loan under section 7(a).''.
    (d) Effective Date.--This Act and the amendments made by this Act 
shall take effect 6 months after the date of the enactment of this Act.

            Passed the House of Representatives November 2, 2021.

            Attest:

                                             CHERYL L. JOHNSON,

                                                                 Clerk.