October 19, 2021
Hot Topic Tuesday – The 7(a) and 504 Program Funded Over $44.75 Billion in Loans
On October 12th, the SBA held a 7(a) Quarterly Connect Call that reviewed the final lending statistics for the fiscal year 2021. By September 30, 2021, almost 52,000 7(a) loans were approved (51,856) which provided more than $36.5 billion to small businesses. The SBA lent over $11-14 billion more in 2021 than they have in the previous five years. The 504 program funded 9,676 loans with more than $8.2 billion.
Roughly $1.23 billion of the 7(a) program was utilized for loans that were $150k or less, and $2.63 billion was approved for loans that were $150-350k. The 7(a) Express loan program had a record-breaking year with over $2.3 billion approved providing financing for 18,064 loans.
Both the 7(a) and 504 Franchise lending activities approved more loans and lent more money in FY21 than the previous 5 years. There were 8,100 7(a) franchise loans worth almost $7.63 billion. For the 504 program, nearly a billion dollars was approved for 886 loans.
The Community Advantage loan program approved 565 loans for more than $84.8 million. SBA’s Microloan program approved 4,393 loans worth over $71.7 million, but the SBA did note that the Microloan approvals were underreported due to a lag in micro lender reporting.
The Microloan program supplied more loans to minority small business owners than the five years prior to 2021. Of all the microloans, around 62% went to minority-owned small businesses and made up 50.5% of the total approved dollars (upwards of $36 million). Close to 50% of the microloans went to women-owned businesses (48.1%), and 3.8% of the microloan approvals were for veteran-owned businesses. In excess of $29.2 million and $4.2 million were approved for women-owned and veteran-owned businesses, respectively.