H.R. 2987: Capping Excessive Awarding of SBLC Entrants Act

This bill, known as the Capping Excessive Awarding of SBLC Entrants Act (CEASE Act), aims to amend the Small Business Act concerning small business lending companies (SBLCs). Below is a summary of its key components:

Short Title

The bill can be referred to by its short title, the Capping Excessive Awarding of SBLC Entrants Act or the CEASE Act.

Limitation on Small Business Lending Companies

The bill proposes to amend Section 23 of the Small Business Act to impose a restriction on the number of small business lending companies that can operate in a non-profit capacity. Specifically:

• The bill mandates that no more than **16 small business lending companies** that are not classified as nonprofit entities can be authorized to make loans under the guidelines of section 7 of the Small Business Act at any given time.

Goals of the Bill

The overarching intent of this legislation is to limit the presence of excessive small business lending companies within the market. This aims to:

• Manage the competition among these lenders.
• Ensure better regulatory oversight.
• Prevent any potential market saturation that could affect small business borrowers.

Implications

By capping the number of authorized SBLCs to 16, the bill could potentially influence the dynamics of small business lending by:

• Restricting access to capital for small businesses if the demand for loans exceeds the capacity of the limited number of SBLCs.
• Providing existing lenders with a more stable market environment and possibly strengthening their position in the market.

Next Steps

Following its introduction, the bill has been referred to the Committee on Small Business for further consideration and discussion.

Relevant Companies

None found.