More than $23.6 billion by 7(a) Program; Community Advantage Reaches $100 Million and Recruits 100th Lender

 

WASHINGTON, D.C. – Fiscal year 2015 proved yet another stellar year for the U.S. Small Business Administration (SBA), as most of its financial assistance programs reached new, all-time records, which translates into substantially increased access to capital for the nation’s small businesses.

The growth in the flagship loan programs — SBA 7(a) and 504 Loan Programs —  is indicative of the continued outreach and streamlining of program delivery.  The increase in the number of small businesses supported in FY 2015 reflects specific focus on improving technology, streamlining delivery, and increasing access to capital for underserved markets, and very small entrepreneurs.

 

FY2015 performance results for SBA’s 7(a) program showed impressive gains over FY2014, with 63,000 loans totaling $23.6 billion; an increase of 22 percent in number of loans and 23 percent for total dollars. This level of program activity demonstrates that access to capital through conventional sources remains a challenge for small businesses.

 

The 504 program saw a slight decline in the number of loans, from 5,885 in FY 2014 to 5,787 in FY2015, but this reduction was offset by a larger dollar amount in FY2015 ($4.3 billion) compared with $4.2 billion in FY2014.

 

For several years, a key priority of the agency has been to ensure that small businesses in underserved markets get their fair share of financing. These businesses have historically encountered greater challenges in obtaining loans through conventional lending.

 

Underserved:

This year, underserved markets received 32,563 loans totaling $13 billion, compared with 25,799 loans and $10.47 billion in FY2014, an increase of 26 percent in number of loans and 24 percent in dollar amount.

Underserved markets include minority, women and veteran-owned businesses. Lending in all three categories was up substantially.

As many startups and new businesses often need lower loan amounts that commercial banks, in general, find difficult to make, SBA continues to strengthen and increase efforts to better serve this segment of the small business community through mission-oriented programs. Salient among this is the Community Advantage program, which provides financing up to $250,000 and the Veteran initiative, which sets upfront fees to zero on loans up to $350,000 to veterans.

 

Community Advantage Pilot Program:

 

In FY2015 Community Advantage (CA) saw an extraordinary growth of almost 83 percent in both number of loans and dollar amount over FY2014. CA also reached three important benchmarks in FY2015 as the program made more than $100 million in just one year, surpassed $200 million since its inception in 2012, and recruited its 100th lender.

 

Loans to Veterans:

 

Loans to veterans saw an increase of 101 percent in dollar amount and 45 percent in number of loans over last year.

 

Small Business Investment Companies:

The SBA exceeded its FY2015 goal for commitments to SBICs by leveraging $2.5 billion in debentures.  SBICs supported 1,210 small businesses with $6.3 billion in funding, exceeding last year’s level of activity.

Exports:

SBA lending hit yet another record in FY2015 as loans to exporters increased to 1,777, an eight percent rise from 1640 loans in FY2014.  The corresponding dollar increased even more, to $1.45 billion, a 17 percent surge over the $1.34 billion in FY2014.

Surety Bonds:

SBA surety bond guarantees provide substantial help to small businesses vying for both government and private contracts. In fiscal year 2015, SBA guaranteed 11,480 bonds for a total contract value of $6.4 billion, and assisted 1,582 small businesses. As a result, over 27,000 jobs were supported.

Disaster Assistance:

While there was not a single catastrophic weather event in 2015, throughout the country there were many major storms, floods, earthquakes and wildfires. SBA’s Office of Disaster Assistance fielded more than 145,000 calls, inspected more than 19,000 damaged properties and approved 116,400 disaster loans totaling more than $371 million. 

For more information about the SBA’s loan programs and other financial assistance as well as services, please visit www.sba.gov.