U.S. Senators Marsha Blackburn (R-Tenn.) and Maggie Hassan (D-N.H.), along with Representatives Brad Finstad (R-Minn.) and Raja Krishnamoorthi (D-Ill.), have introduced the Federal Loan Systems Modernization Act. The proposed legislation aims to create a unified government lending platform, “Lending.gov,” which would serve as a single entry point for borrowers and standardize loan management across federal agencies while maintaining each agency’s program authority.
“Tennesseans, small businesses, and families across the country deserve a simple process that makes accessing federal loans easier,” said Senator Blackburn. “The Federal Loan Systems Modernization Act would streamline the process for borrowers and federal agencies, replacing the confusing patchwork of loan programs that frustrates Americans every day. It would also stop waste, fraud, and abuse of taxpayer dollars.”
Senator Hassan emphasized the scale of federal lending and its challenges: “The federal government is one of the largest lenders in the world, with programs that support housing, small businesses, infrastructure, disaster recovery, and national security. But the outdated systems used by many of these lending programs cost billions and have allowed tens of billions in fraud. This bipartisan bill will modernize federal lending through a shared services platform known as Lending.gov, helping make our government more user friendly, combat fraud, and save taxpayer dollars. It is one of many ways in which we can make our government better deliver for people while saving money at the same time.”
Representative Finstad highlighted modernization benefits: “By creating Lending.gov as a single, secure access point for federal loan programs, the Federal Loan Systems Modernization Act finally brings our loan systems into the 21st century. I’m proud to introduce this legislation with Sen. Blackburn and Rep. Krishnamoorthi to improve efficiency and streamline access across agencies, minimize opportunities for fraud, and deliver the kind of commonsense modernization that makes government work better for the people it serves.”
Representative Krishnamoorthi addressed current inefficiencies: “Today, the federal government operates more than 175 loan programs on outdated, fragmented systems that waste billions of taxpayer dollars and leave the door open to fraud. Our legislation establishes Lending.gov as a single, secure, modern platform that will streamline operations, strengthen fraud detection, and ensure assistance reaches Americans who qualify without unnecessary delays. By consolidating these systems, we can save at least $2 billion annually while delivering faster, more accountable service. This is smart government: cutting waste, protecting taxpayers, and making federal programs work the way they should.”
Federal credit programs now number over 125 nationwide with outstanding balances nearing $2 trillion each year. These include loans from agencies such as Small Business Administration for business expansion; U.S. Department of Agriculture for rural development; U.S. Department of Energy for energy projects; U.S. Department of Housing and Urban Development for housing; and U.S. Department of Transportation for infrastructure projects.
However many are managed using outdated technology resulting in inefficient spending practices—and increased risk of fraud or poor customer experience—compared to private sector standards.
The new legislation builds on priorities outlined in President Trump’s Management Agenda calling for technology upgrades across agencies—including consolidation into standardized portals like Grants.gov—to increase efficiency while preserving agency autonomy.
Modern features planned include enhanced identity verification tools; cross-program data matching; real-time risk analytics; standardized underwriting controls—all designed to detect fraudulent applications earlier.
Organizations endorsing this bill include Center for USA Lending; Council for Citizens Against Government Waste; Association of Government Accountants; Shared Services Leadership Council; Committee for a Responsible Federal Budget.
Doug Criscitello from Center for USA Lending stated: “The communities that depend most on federal credit programs…are also those most harmed when systems are slow… The Center strongly believes this proposal warrants prompt action…”
Tom Schatz from Council for Citizens Against Government Waste added: “This consolidation…would facilitate access…reduce duplication…improve detection/prevention [of] waste/fraud/abuse/mismanagement…”
Ann Ebberts from Association of Government Accountants noted: “Fragmented lending systems cost taxpayers money… AGA supports advancing this concept now…”
John Marshall from Shared Services Leadership Council commented: “Shared services works…modern infrastructure…reduced duplication…and agency autonomy preserved…”
Maya MacGuineas from Committee for a Responsible Federal Budget said: “A shared-services approach…has potential to help reduce waste/fraud…and deliver better value…”
Senator Blackburn represents Tennessee in Washington D.C., serving on several Senate committees including Finance; Commerce Science & Transportation; Veterans’ Affairs; Judiciary—where she has chaired subcommittees related to consumer protection/technology/data privacy (official website). She has advocated causes such as veterans’ care/online child protections/social issues (official website) while supporting limited government/lower taxes/border security/affordable health care/veterans’ support (official website). Her offices are located throughout Tennessee including Memphis/Jackson/Nashville/Chattanooga/Knoxville/Johnson City (official website).
