WASHINGTON – United States Small Business Administration (SBA) administrator Isabella Casillas Guzman announced that the agency has reached $ 44.8 billion in financing for small businesses through more than 61,000 traditional loans for fiscal year (FY) 2021.
âIn the midst of a once-in-a-generation pandemic, the SBA’s mission-driven team has made a record number of traditional SBA loans to small businesses across our nation – in addition to more than $ 1.1 trillion. dollars in COVID-related relief since the start of the pandemic, âsaid SBA Administrator Guzman. âWhile progress has been made, our data also tells a deeper story: historic inequalities in access to capital persist, and we need to do more to lower the barriers to entry of opportunities for all of our entrepreneurs. We will continue to build on our impactful programs to meet small businesses where they are and connect them with the resources they need to thrive. ”
âThe SBA continues to make progress in helping small businesses access much-needed capital, but there is still a long way to go,â said Patrick Kelley, associate administrator of the Office of Capital Access. âOur flexible, low-interest 504 loan program has increased lending volume by 41%, and the SBA team is already at work for fiscal 2022 to support job and growth growth. business across the country. â
Under the leadership of Administrator Guzman, the SBA has made it a priority to increase access to capital for business owners across the country, especially in traditionally underserved communities. Data on traditional loans for fiscal year 2021 includes:
$ 36.5 billion in 7 (a) loans: Almost 52,000 loans 7 (a) worth over $ 36.5 billion have been made to small businesses. Lenders reported that minority business owners received nearly $ 11 billion in 7 (a) loans or 30% of the SBA’s total 7 (a) portfolio. The data also shows that women-owned businesses received nearly $ 5 billion in FY21, while veteran-owned businesses received $ 1.2 billion.
$ 8.2 billion in 504 loans: Working with Authorized Development Corporations (CDCs), the SBA’s 504 program made 9,600 loans worth over $ 8.2 billion to small businesses, fully depleting the funding authority for the first time in the history of the program. Minority business owners received nearly $ 1.88 billion in loans, or 23% of the total portfolio of 504. In FY21, the program also provided over $ 712 million in loans to women-owned businesses and increased its support to small rural businesses by almost 33%.
$ 71.8 million in microcredit financing: In fiscal year 2021, $ 71.8 million in microloans was granted to nearly 4,400 small businesses. Forty-one percent of those loans went to underserved communities, including small businesses owned by Hispanics and blacks.
Despite significant progress in its traditional loan programs, the agency is well aware of the gaps that persist for some communities in access to capital. SBA’s existing loan programs play an important role in credit markets for small businesses, especially those with collateral and proven income that are denied a loan by a commercial bank or often lack relationships with lenders. established.
Over the past five years, loans to smaller borrowers through SBA-backed Loan 7 (a), Express, and Community Advantage have declined by over 45%. However, the decline in the proportion of small loans is not unique to SBA loan portfolios. Federal Deposit Insurance Corporation (FDIC) data on commercial small business loans by regulated banks shows an overall 3% drop (translating to over 600,000 loans) in the proportion of loans below 100,000 $. This lack of lenders’ appetite for small loan amounts has resulted in disproportionate impacts on minority business owners. Non-Hispanic black-owned businesses and businesses with sales of $ 100,000 or less were half as likely as non-Hispanic white-owned businesses to obtain bank funds (23%, 24%) , and Latino-owned businesses were also lower (34%).
Closing the systemic divide in access to capital for smaller and underserved businesses has been the North Star of Administrator Guzman and will continue to be a top priority for the SBA in FY22 and beyond.
The SBA continues to focus on alleviating the pandemic and further supporting the country’s economic engine for recovery and growth. Since mid-2020, the SBA has provided more than $ 1,000 billion in economic assistance through COVID relief measures to help small businesses in America and those hardest hit by the pandemic survive. Traditional state-specific SBA loan numbers can be found in this dataset reflecting agency approvals by state and congressional district.
â¢ $ 2.6 billion in loans 7 (a)
â¢ $ 3.9 million in 504 loans
â¢ $ 412,156 in the financing of microcredits
Additionally, the SBA is on schedule to celebrate National Veterans Small Business Week next week, November 1-5, 2021.
For more information on SBA loan programs, financial aid, and other services, visit www.sba.gov.
The US Small Business Administration is making the American dream of becoming a business owner a reality.
As the only resource and voice for small businesses backed by the strength of the federal government, the SBA gives entrepreneurs and small business owners the resources and support they need to start, grow or grow their businesses, or grow their businesses. recover from a declared situation. disaster.