US Government Policy On SMB Lending In Flux

U.S. President Donald Trump announced over the weekend that U.S. Treasurer Jovita Carranza is his pick to lead the Small Business Administration (SBA), after its current chief, Linda McMahon, announced on Friday (March 29) that she will leave the post. “Jovita was a great Treasurer of the United States, and I look forward to her joining my Cabinet!” said Trump in a tweet announcing the nomination, according to Reuters. Carranza has a history at the SBA, serving as its deputy administrator between 2006 and 2009. Her rise to the position of SBA chief is not expected to disrupt the status quo, but she would step into the seat at a time of broader controversy at the SBA, surrounding its 7(a) small business lending program. Last year, the U.S. Senate passed legislation that increased the SBA’s authority over the program, bolstering its credit risk management office, and increasing its oversight of its lending partners that facilitate the financing of small business loans via the program. At the time, the legislation garnered support from the American Bankers Association and the National Association of Federally-Insured Credit Unions.

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