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NAFCU witness Sonya McDonald, executive vice president and chief lending officer at Randolph-Brooks Federal Credit Union, told a House Small Business subcommittee hearing Thursday that the arbitrary cap on credit union member business lending must be lifted so credit unions can better serve community small businesses.

Subcommittee on Investigations, Oversight, and Regulations Ranking Member Alma Adams, D-N.C., during Thursday's hearing, said credit unions carry on the mission of people helping people and asked how Congress could help further that mission. McDonald said the MBL cap needs to be lifted – especially for smaller credit unions that hit this cap rather quickly.

The hearing addressed the Small Business Administration's 7(a) loan program, in which McDonald's credit union participates. She said in her opening statement that in 2016, "RBFCU was the No. 1 SBA lending credit union in our 55-county SBA district." She says the credit union has provided SBA loans for as little as $15,000 to as much as $3 million, with the average loan being around $90,000.

NAFCU witness Sonya McDonald (middle) with subcommittee Ranking Member Alma Adams, D-N.C., and subcommittee Chairman Trent Kelly, R-Miss.

Adams also asked how further participation in the SBA's 7(a) loan program would impact credit unions. McDonald said it would allow more institutions to be able to offer these kinds of loans and increase the number of small businesses in their communities.

Subcommittee Chairman Trent Kelly, R-Miss., asked McDonald her thoughts on securing SBA loans for her members and how that process works. McDonald said that the credit union has a "fiduciary duty to do the right thing. We have to be able to document the reasons we went with the SBA," she said.

Rep. Don Bacon, R-Neb., asked for McDonald's suggestions on how the SBA could enhance its loan program processes. McDonald said the SBA's unwritten rules or best practices should be published to better aid financial institutions participating in the programs.

In 2015, NAFCU signed a three-year memorandum of understanding with the SBA aimed at getting more credit unions to increase their lending to member small businesses through SBA micro loan programs.