House lawmakers seek more AI transparency from the SBA

May 23, 2026 - 00:12

The House Small Business Committee has moved forward with legislation that would force the Small Business Administration to provide a yearly breakdown of how it uses artificial intelligence. The bill, which cleared the committee in a recent vote, comes just weeks after a Government Accountability Office report flagged serious gaps in the agency's compliance with federal AI inventory rules.

Under the proposed measure, the SBA would need to submit an annual report detailing every AI system it deploys, how those tools affect loan processing, fraud detection, and customer service, and what steps are taken to avoid bias or errors. Lawmakers on both sides of the aisle expressed frustration that the agency has not been fully transparent about its adoption of AI, especially as small business owners increasingly interact with automated systems for applications and approvals.

The GAO found that the SBA failed to properly catalog several AI tools in use, raising concerns about oversight and accountability. Committee leaders argued that without a clear mandate, the agency might continue to operate AI systems without adequate public scrutiny. The bill now heads to the full House for consideration, where supporters hope it will pass with bipartisan backing.