Congress Is One Step Closer to Letting SBA Loans Cover Your Software
The House passed the Small Business Technological Advancement Act on June 24 by a vote of 414 to 4. It came out of the Small Business Committee 23 to 0 a few weeks before that. Votes that lopsided usually mean nobody had much of an argument against it and the real question was floor time.
What it does is small. The bill adds one paragraph to the end of Section 7(a) of the Small Business Act, authorizing the SBA to finance "business software or cloud computing services, or any such technology" that handles operations, product or service delivery, payroll, HR, sales and billing, or accounting and inventory. It names AI tools specifically.
So: your POS, your payroll platform, your billing stack, your books, the AI tools you've wired into your operations. All of it listed in statute as something a 7(a) loan can pay for.
The part that tells you what was really going on
Tucked into the bill is a rule of construction, which is the legislative version of a footnote. It says three things. Nothing here means loans already made for software were improper. This doesn't open 7(a) to R&D. And it doesn't narrow what counts as working capital.
Read that first one again. Congress went out of its way to say prior software loans were fine, which tells you plenty of lenders were already writing them under working capital and nobody wanted to hand a borrower's lawyer a reason to argue otherwise. The bill isn't creating something new so much as ending an argument.
Why the argument existed
Lending likes collateral it can repossess.
Nobody has ever raised an eyebrow at a 7(a) loan for a $60,000 delivery van. Sixty thousand a year on the software that routes that van and invoices the customer and runs payroll? That depended on your lender. Some folded it into working capital and moved on. Others didn't want the file, and the owner ended up putting it on a card or taking an advance with a daily remit.
The strange part is that the second business isn't riskier than the first. It's the same business. It just spends its money on things you can't put a lien on.
Meanwhile small business cost structure kept sliding in exactly that direction. A bookkeeping platform, a scheduler, a CRM, and a payroll provider can quietly add up to more per year than any single machine on the floor. That's just what running a company looks like now.
What to actually do about it
First, don't plan around it. This passed the House and went to the Senate, where a companion bill has had a committee hearing but nothing more. 414 to 4 is real momentum. Momentum isn't law, and the legislative calendar eats a lot of popular bills.
Second, go find out what you actually spend on software. Pull a year of statements and list every recurring charge, including whatever's quietly running on your personal card. Most owners we talk to are off by a lot, usually low. You can't decide whether financing something makes sense until you know how big it is.
Third, if that spend is currently sitting on a 24% card or an advance, that's costing you money this month, not whenever the Senate gets around to it. Worth asking your lender how they treat software under working capital today. Some already say yes, which is the whole reason that footnote exists.
And one thing that isn't changing: who qualifies. A new eligible use isn't a new eligible borrower. If you haven't used 7(a) before, it's not a government loan. The SBA guarantees part of a loan a participating lender makes, and the program is built for businesses that can't get reasonable terms somewhere else. That test runs both ways. If your bank will already finance this at a fair rate, 7(a) isn't your lane. If it won't, this bill was written with you in mind, and the thing standing between you and a yes is still your file. Cash flow, coverage, time in business, documentation that holds up under a lender's read.
Where we sit
We built Fido HQ on a fairly simple read of the problem: there's no shortage of people in this country who can run a business well. There's a shortage of capital reaching them, and a lot of that gap is preparation nobody walked them through.
H.R. 915 is one paragraph in a very long statute. But an owner who buys AI tooling that lets four people handle what used to take nine is making the same bet as an owner buying a second truck. One of them has always been able to walk into a bank and be taken seriously about it. The other one shouldn't have to argue.
We'll be watching the Senate. Until then the job hasn't changed. Know what a lender is going to see in your business before they see it, fix what's weak, and have the package ready when it counts.
Small Business Finance, reimagined.
Fido Technologies builds Fido HQ, the head office for small business. This post is informational and isn't legal, tax, or financial advice. H.R. 915 has passed the House and has not been enacted.