SBA Information Notice 5000-850230 - Sunset of the Community Advantage Pilot Program
Summary
SBA Information Notice, control no. 5000-850230, effective October 11, 2023, addressed to SBA employees and CA Pilot Lenders, on the sunset of the Community Advantage (CA) Pilot Program. It announces the Federal Register Notice published October 5, 2023 at FRN 2023-22185, giving a third and final public notice that the program terminates on October 31, 2023, a date extended from the September 30, 2023 announced twice before. The notice explains that on April 12, 2023 SBA published the SBLC Rule, 88 FR 21890, lifting the moratorium on licensing new Small Business Lending Companies.
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Full text
SBA Information Notice
TO: All SBA Employees and CA Pilot Lenders CONTROL NO.: 5000-850230
SUBJECT: Sunset of the Community Advantage EFFECTIVE: October 11, 2023
Pilot Program
The purpose of this notice is to announce the publication of the Federal Register Notice (FRN)
on the sunsetting of the Community Advantage (CA) Pilot Program; Community Advantage
Pilot Program in the Federal Register on October 5, 2023, at FRN 2023-22185.
The publication of the FRN on the Sunsetting of the CA Pilot Program is to provide a third and
final public notice of the CA Pilot Program’s termination on October 31, 2023. As described
below, SBA has previously announced on two separate occasions that the CA Pilot Program will
sunset on September 30, 2023. Although the previous notices announced the termination of the
CA Pilot Program on September 30, 2023, the termination date has been extended and will now
be October 31, 2023.
After evaluating the impact of the CA Pilot Program, on April 12, 2023, SBA published the Final
Rule on Small Business Lending Company (SBLC) Moratorium Rescission and Removal of the
Requirement for a Loan Authorization (SBLC Rule), 88 FR 21890. In the SBLC Rule, SBA
lifted the moratorium on licensing new SBLCs and created a new type of SBLC called a
Community Advantage Small Business Lending Company (CA SBLC). The SBLC Rule also
provided for the grandfathering of current CA Pilot Lenders to be licensed as CA SBLCs with
permanent 7(a) lending authority. This means when SBA authorizes a CA SBLC license for a
CA Pilot Lender, the CA Pilot Lender will no longer be making 7(a) loans in a temporary pilot
program but will instead be making regular 7(a) loans under a CA SBLC license in the 7(a)
program.
On May 1, 2023, SBA published Information Notice 5000-846918, Community Advantage
Small Business Lending Company Conversion, to announce that effective May 12, 2023, SBA’s
Office of Credit Risk Management (OCRM) initiated a program to enable current CA Pilot
Lenders to become CA SBLCs. This notice also communicated to Lenders that SBA intended to
sunset the CA Pilot Program.
PAGE 1 of 2 EXPIRES: 10/1/24
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58
Federal Recycling Program Printed on Recycled Paper
SBA issued a notice and request for comments on May 22, 2023, 88 FR 32623, SBLC
Application Process, to announce that SBA’s Office of Capital Access (OCA) opened the
application period for new SBLC licenses from June 1, 2023, to July 31, 2023, and shared the
process by which interested entities may apply. SBA also announced in this notice that the CA
Pilot Program will sunset.
Questions
Questions concerning this Notice may be directed to the Lender Relations Specialist in the local
SBA Field Office.
Kathryn Frost
Associate Administrator (Acting)
Office of Capital Access
PAGE 2 of 2 EXPIRES: 10/1/24
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58
Federal Recycling Program Printed on Recycled Paper
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