Rep. Blaine Luetkemeyer, R-Mo., introduced a bill that would prohibit the Small Business Administration (SBA) from providing direct business loans under the 7(a) loan program.

The IMPROVE the SBA Act, H.R. 7628, would also create a role for private-sector lenders like credit unions in the SBA’s Disaster loan program.

“Thank you to Rep. Luetkemeyer working with CUNA and the Leagues to  preserve the relationship that small businesses have with locally-focused not-for-profit credit unions,” said Jim Nussle, CUNA president/CEO. “Provisions like this ensure that communities advance through financial partners who understand the situation folks are feeling on the ground, rather than being affected by Washington bureaucrats.”

This is the latest effort by Rep. Luetkemeyer to curtail direct SBA lending. Earlier this year, he introduced H.R. 6037, which would also prevent the SBA from making direct loans under the SBA 7(a) program. Loans made through the 7(a) program are up to 85% guaranteed by the federal government, and the government-guaranteed portion of the loan does not count against a credit union’s member business lending cap.