Advancing the Mentor-Protégé Program for Small Financial Institutions Act

Summary of HR 3709: Advancing the Mentor-Protégé Program for Small Financial Institutions Act

Purpose and Intent

The Advancing the Mentor-Protégé Program for Small Financial Institutions Act (HR 3709) aims to enhance the capacity of small financial institutions, particularly those that are rural or minority-owned, by establishing a formal mentor-protégé program. This program will pair these smaller institutions with larger financial institutions to improve their ability to serve customers and potentially act as financial agents for the government.

Key Provisions

• Establishment of the Program: The bill mandates the Secretary of the Treasury to create a Financial Agent Mentor-Protégé Program. This program will allow large financial institutions to mentor small financial institutions, helping them to:

  • Prepare to perform as financial agents.
  • Improve their service delivery to customers.

• Outreach Initiatives: The Secretary is required to conduct outreach events at least once a year to promote participation in the program among financial agents, large financial institutions, and small financial institutions.

• Exclusion Process: The Secretary will develop guidelines for excluding certain financial agents or institutions from participating in the program if necessary.

• Reporting Requirements: The Office of Minority and Women Inclusion at the Treasury will report to Congress on the program's participation metrics and outreach activities.

• Definitions: The bill provides clear definitions for key terms, including:

  • Financial Agent: A national banking association designated by the Secretary.
  • Large Financial Institution: Entities regulated by federal banking agencies with assets of $50 billion or more.
  • Small Financial Institution: Institutions with assets of $2 billion or less, including minority and rural depository institutions.

Impact

The bill is designed to benefit:
- Small Financial Institutions: By providing them with mentorship and resources to enhance their operational capabilities.
- Large Financial Institutions: By fostering partnerships that can lead to expanded service offerings and community engagement.
- Customers: Ultimately, the program aims to improve the quality of financial services available to customers of small financial institutions.

Legislative Timeline

• Introduced: June 4, 2025
• Committee Consideration: The bill was reviewed and amended by the Committee on Financial Services, with a favorable report issued on July 15, 2025.
• Current Status: As of July 15, 2025, the bill has been reported (amended) and placed on the Union Calendar for further consideration.

Conclusion

HR 3709 represents a strategic effort to bolster the capabilities of small financial institutions through mentorship from larger entities, thereby promoting a more inclusive financial landscape. The establishment of this program is expected to enhance service delivery and operational readiness among smaller institutions, ultimately benefiting their customers and communities.