SBA lending shows strong upward trend

It appears the Small Business Administration is fulfilling its mission to get lending flowing to small businesses to support their long-term success. According to the SBA’s Lending Statistics for Major Programs, the 7(a) and 504 programs have delivered on their funding promise, as of September 26, 2015:

  • Totals for both types of loan approvals stand at $27.3 billion, a 20% increase over the same period in 2014 ($22.8 billion). Loan approvals for loans less than $150,000 have grown 16%to $2.2 billion compared to last year over the same period ($1.9 billion).
  • 7(a) lending is up 23% to $23.1 billion. The best year for 7(a) lending was in FY2011 with $19.64 billion, when the loan guarantee was increased to 90% and borrower guarantee fees were waived as part of the federal stimulus to end the recession.
  • Total volume of approved CDC/504 loans rose in September to $4.2 billion YTD, more than 2% ahead of the same period in FY 2014.

SBA Lending Shows Strong Upward Trend 1

These results are meeting small business lenders’ expectations. According to the Small Business Finance Institute’s 2015 SBA Lending Outlook Survey, which measured SBA lenders’ confidence in growth and expansion:

  • 86% expected to increase the funded loan dollar volume
  • 87% expected to increase the number of loans funded
  • 58% expected an increase in the loan/applicant ratio
  • 54% planned to hire more people to facilitate small business loans

Still, SBA lenders perceive barriers to successful SBA lending, which are outlined below.

SBA Lending Shows Strong Upward Trend 2

 

 

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