The SBA’s Office of Credit Risk Management (“OCRM”) has indicated that it is developing a Self-Assessment tool to assist lenders in ensuring compliance with SBA’s electronic signature requirements under SOP 50 10 8, Appendix 10 (click here to access the SOP on the SBA website).
As set forth in Appendix 10, the use of an electronic signature is voluntary; however SBA lenders who choose to use electronic signatures must fully comply with the performance standards outlined in Appendix 10.
SBA lenders must ensure that any electronic signature technology vendor they use:
- Complies with Section 101 of the Electronic Records and Signatures in Global and National Commerce (“ESIGN”) Act;
- Has the experience, capabilities, and expected longevity to meet all SBA electronic signature requirements;
- Includes vendor agreements that contain express provisions that vendors will comply with all applicable SBA requirements pertaining to Appendix 10;
- Includes vendor agreements language that would ensure that vendor representatives will be available to provide testimony to support the United States government in litigation regarding electronic signature data that will be introduced in court;
- Meets disaster recovery and archiving requirements; and
- Has adequate quality control processes.
In anticipation of the OCRM Self-Assessment tool, lenders are encouraged to consult with their internal systems management and compliance teams, as well as their third-party vendors to ensure compliance with the ESIGN Act and the standards outlined in Appendix 10. Additionally, regulated lenders may wish to consult with their respective prudential regulators (Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, and National Credit Union Administration) for additional guidance.
If your lending institution has questions about SBA requirements for electronic signatures, or other SBA lending matters, please contact us at SBAQuestions@JellumLaw.com.