June 2, 2021

Caity Roach

C-Suite Wednesday – SBA 7(a) Lending Activity Continues to Outpace 2019 and 2020

Throughout 2020 and early 2021 traditional SBA 7(a) lending slumped as borrowers opted for Paycheck Protection Program (PPP) loans. However, according to the SBA’s most recent lending reports, 2021 7(a) lending activity by dollar amount has surpassed pre-pandemic levels and is now 6.7% higher than its 2019 level. 

Here are some of the highlights from the SBA’s most recent lending report:

  • 2021 SBA 7(a) lending by dollar amount has now reached $15.4 billion, an 13% increase from 2020 and 7% higher than 2019.

  • As of the date of the report’s publication, 6,554 7(a) loans worth $4.4 billion went toward minority-owned businesses. Notably, 26% went to female-owned small businesses, 20% went to Asian Americans, and 3% went to veterans.

  • The average SBA 7(a) loan size has increased considerably, with loans over $2 million now reflecting 40% of approved loans (approximately 16% times higher than in 2020 and 2019).

  • Year-over-year the percentage of SBA 7(a) loans to startups increased by one percentage point from 2019 and 2020 to 17% and the percentage of SBA 7(a) loans for change of ownership remains consistent with the SBA’s previous reading of 13%.

  • SBA 504 lending activity continues to increase year over year. Currently, the SBA reports that they have approved $4.7 billion in 504 loans, an 27.9% increase from the previous year, and a 59.8% increase from 2019.

  • Since the pandemic started, the SBA Express loan program and the Community Advantage program have decreased in popularity. In fiscal year 2021, the SBA has approved 9,281 Express loans worth $1.1 billion and 319 Community Advantage loans worth $46.3 million. 

Click here to read the SBA’s full May 21, 2021, weekly lending report.