Capping Excessive Awarding of Sblc Entrants Act of 2025

Floor Speech

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Mr. BRESNAHAN. Mr. Speaker, my bill, the Capping Excessive Awarding of SBLC Entrants Act, or the CEASE Act, restores a vital piece of integrity to the flagship SBA 7(a) loan program.

The Small Business Administration is authorized to issue government- backed 7(a) loans through certified depository institutions, like banks and credit unions, as well as certified nonbank lenders, like fintech companies.

Unlike certified depository institutions, whose primary regulator is the Federal Reserve, the nonbank SBLCs are primarily regulated by the SBA, meaning they are not subject to the same regulations and requirements.

Together, the limited number of SBLCs and prudent lending standards that used to be in place at the SBA were necessary guardrails to ensure that the 7(a) program remained zero-subsidy, costing taxpayers zero dollars.

The SBA had its own concerns that it did not have the oversight capabilities to monitor and regulate an unlimited number of SBLCs. Yet the Biden-Harris administration sought to expand the number of SBLC licenses, while also lowering lending standards and loosening underwriting criteria in the 7(a) program. The previous administration did this, even though these SBLCs facilitated massive fraud of the Paycheck Protection Program.

Expanding SBLCs' licenses when the SBA itself acknowledged that it is unequipped to regulate additional for-profit, nonbank lenders is problematic. That is why my legislation is so important to ensure the SBA is not adding excessive SBLCs that it cannot properly regulate. We cannot continue giving the Federal Government ways to abuse taxpayer dollars.

I thank the Trump administration for taking swift action in returning prudent lending standards to the 7(a) program. Combined with the CEASE Act, those efforts will return the SBA to its proper oversight capabilities and ensure that federally regulated lenders, such as community banks, remain a fundamental pillar of 7(a) lending.

The bill was thoughtfully drafted to encompass the original 14 SBLCs and 2 additional SBLCs licensed in 2024 after the Biden-era rule changed. No existing SBLC licenses would be revoked as part of this bill.

Mr. Speaker, I thank the great members and staff of the Small Business Committee for working with me in bringing this bill to the House floor today.

Mr. Speaker, I ask my colleagues on both sides of the aisle to vote ``yes'' on this practical and sensible piece of legislation.

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