There is a move underway by some parties in Washington to put the SBA into the Direct Lending Business. This initiative, in my opinion, is a terrible idea.
Traditionally, the only time that the SBA lends money directly is when there is a disaster, and they use the EIDL program. This program is designed to work in small targeted areas. However, the program has been nothing short of a disaster when large-scale disasters have happened, such as COVID 19.
The SBA works best when it serves as a guarantee program, and banks and some non-bank authorized lenders leverage it.
The goal is to expand SBA lending and availability, particularly to underserved businesses that need smaller loan amounts. We can accomplish this by simplifying the requirements of smaller loans. These changes would make it easier and faster for banks to make these loans.