This bill brings consumer lending protections to small business loans. Right now, small businesses don't have the same protections that regular consumers get when borrowing money. This bill changes that by requiring lenders to be more transparent and fair when offering loans to small business owners.

Specifically, lenders would have to clearly explain all the loan terms upfront when they make an offer—so business owners know exactly what they're getting into before they commit. The bill also prevents lenders from tacking on extra fees when a small business refinances or modifies an existing loan, which is a common practice that can catch borrowers off guard.

The Consumer Financial Protection Bureau, the federal agency that oversees consumer lending, would gain authority to regulate small business financing the same way it regulates regular consumer loans. This means small business owners would have more oversight and protection when dealing with lenders, similar to what individual consumers already have.

Small Business Financing Disclosure Act of 2023

Velázquez, Nydia M.

Small Business Lending Disclosure Act of 2023 This bill applies specified consumer lending protections to small business lending and extends the Consumer Financial Protection Bureau's regulatory authority regarding consumer financial products and services to include small business financing. Among other requirements, lenders offering financial products to small businesses must disclose the terms of the financing upon extending an offer and are prohibited from charging certain additional fees on a refinanced or modified loan.