Five Things a Small Business Owner Might Not Know About the U.S. Small Business Administration (SBA)

23 Sep
grow my business using the SBA

Created in 1953, the mission of the U.S. Small Business Administration (SBA) is to aid, counsel, assist and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy of our nation. The SBA helps start, build and grow businesses in a variety of ways, including small business financing through SBA loan programs. Chances are you have a SBA office in your city and/or organizations that partner with SBA to assist small businesses.

Despite SBA’s strong presence in the small business community, some small business owners do not realize the full scope of services and programs available through SBA and their partners. In this article, we will review five facts about the SBA and how to grow your business using SBA programs and resources.

#1. The SBA is Not a Lender

The Small Business Administration (SBA) offers financial assistance for new or existing businesses through guaranteed loans made by banks and non-bank lenders. The SBA itself, however, does not directly provide small business financing. Instead, the SBA guarantees a portion of the loan it will repay the lender if the borrower defaults on their loan payments (guarantee is subject to meeting SBA requirements).

Excelsior Growth Fund’s parent company, New York Business Development Corporation, is an SBA lender. New York Business Development Corporation has extensive experience with a variety of SBA loan programs. Due to the complexity of the SBA process, it is a wise decision to select a lending partner that has handled SBA loans to ensure a smooth and positive experience for you and your business.

#2 The SBA Offers a Variety of Loan Programs

The SBA offers a variety of loan programs from 7(a) to microloan and 504, to name a few. The most common SBA loan program is the 7(a) loan program. Basic uses for 7(a) loan proceeds include working capital, machinery or equipment purchase, real estate purchase, new construction or renovation of existing building, start up or assistance in acquisition, operation or expansion of an existing business, and refinancing business debt under certain circumstances.

The microloan program provides small, short-term loans up to $50,000. Microloans can be used for working capital, to purchase inventory or supplies, to purchase furniture or fixtures, and to purchase machinery or equipment. Microloans cannot be used to pay existing debts or to purchase real estate.

The 504 loan program provides financing for major fixed assets, including equipment and real estate. A 504 loan cannot be used for working capital or inventory, consolidating, repaying or refinancing debt, and speculation or investment in rental real estate.

For more information on SBA loan programs complete with eligibility and application details, visit the loan program page of the SBA website.

#3. You Can Access Counselors Through SBA Partner Organizations

SBA partner organizations include SCORE, Small Business Development Centers and Women’s Business Centers. Counseling and educational services are available through these partner organizations, most services at no cost.

Free counseling, advice and information on starting a business are available through the Service Corps of Retired Executives (SCORE). SCORE is a nonprofit organization sponsored by the SBA. There are approximately 348 SCORE chapters across the United States that have served nearly 10 million since it was founded in 1964. SCORE members are volunteers, mostly retired, who were business executives and/or owners. SCORE members offer free and confidential one-on-one counseling in-person, by e-mail or by phone.  Contact your local SCORE chapter to help them pair you with a SCORE member whose experience best fits your business needs.

Free consulting services are also available through the network of Small Business Development Centers (SBDCs). SBDCs are hosted by leading universities and state economic development agencies, and funded in part through a partnership with SBA. SBDC advisors provide free business consulting in the following areas: business plan development, manufacturing assistance, financing packaging and lending assistance, exporting and importing, disaster recovery assistance, procurement and contracting aid, market research help, 8(a) program support, and healthcare guidance.

Women’s Business Centers assist women in starting and growing their small business through comprehensive training and counseling on a variety of topics. There are nearly 100 centers throughout the United States. Contact a center near you to learn about programs and services available in your area.

#4. The SBA Offers A Robust Online Learning Center

The SBA website features a robust Learning Center with self-paced courses on a wide array of business topics. The Learning Center is categorized by topic; topics include financing, government contracting, managing a business, marketing and starting a business. And don’t forget to browse SBA’s events calendar page organized by zip code and date!

#5 The SBA is a Valuable Resource for All Small Business Owners

SBA programs and services are a valuable resource to businesses in every industry and stage of growth. Did you know Ben & Jerry’s Ice Cream received assistance from SBA? Many successful businesses have been touched by SBA programs, including Under Armour who received an SBIC-backed investment through SBA, and Chobani yogurt who received an SBA loan.

In conclusion, get to know the small business resources available to you in your city and online. The U.S. Small Business Administration (SBA) has a variety of services and programs available to you through their district offices, website, and partner organizations. Since its founding, the SBA has delivered millions of loans, loan guarantees, contracts, counseling sessions and other forms of assistance to small businesses across the country. Get in touch with your local SBA office or visit today!


About Excelsior Growth Fund

Excelsior Growth Fund (EGF) helps businesses in New Jersey, New York and Pennsylvania grow by providing streamlined access to business loans and advisory services. EGF’s signature product, the EGF SmartLoan™, provides up to $100,000 in fast, transparent, and affordable financing through a secure online platform. Larger loans up to $500,000 are also available. EGF is a nonprofit organization and is certified by U.S. Department of Treasury as a Community Development Financial Institution (CDFI). Learn more