Berks County News

This week, the House Small Business Committee passed H.R. 1804, known as the Small Business 7(a) Loan Agent Oversight Act. The bill, introduced by Congressman Dan Meuser from Pennsylvania's 9th District, received unanimous bipartisan support.

The legislation mandates that the Small Business Administration (SBA) Office of Credit Risk Management submit an annual report to Congress on loans generated through loan agent activity. According to the SBA’s Inspector General, nearly 15 percent of all 7(a) loans involve a loan agent. Over the past decade, more than $335 million in documented loan agent fraud has been reported.

The bill aims to ensure Congress receives necessary data for proper oversight of the SBA’s flagship loan program. It requires reporting on loans processed with loan agents' assistance and default rates associated with those loans. Additionally, it obligates the SBA to conduct risk analysis on participating agents.

Congressman Meuser stated: “Access to capital remains one of the biggest barriers to growth for entrepreneurs, and the SBA’s 7(a) Loan Program must be efficient, stable, and well-managed." He emphasized that his bill provides essential data for oversight by requiring reports on fraudulent loans and risk analysis within the program. "Strengthening transparency and accountability will protect taxpayer dollars," he added.

In Fiscal Year 2023, approximately 47,700 loans totaling $25.7 billion were facilitated through the SBA’s 7(a) loan program. This program is a primary lending tool for small businesses unable to obtain credit elsewhere. Instead of issuing direct loans, it offers guarantees to private lenders supporting small business growth.

On Wednesday, Congressman Meuser spoke in favor of H.R. 1804 at the House Small Business Committee meeting.