SBA 7(a) Working Capital Program Begins Today

August 5, 2024

Delaney Sexton
Contributing Editor

SBA 7(a) Working Capital Program Begins Today

“Small businesses need affordable working capital to pursue revenue growth opportunities made available thanks to President Biden’s Investing in America agenda,” says SBA Administrator Guzman. “The SBA has expanded access to capital and increased small dollar lending over the past three and a half years – now, we are strengthening loan offerings through this new 7(a) Working Capital Pilot program to provide growth-oriented small businesses with competitively-priced lines of credit to fund orders and projects as they scale.”

Lenders currently approved to process 7(a) loans can begin processing 7(a) WCP loans on August 1, 2024. Due to the specialized nature of this type of lending, the SBA has created a new type of delegated authority for WCP called Preferred Lender Program (PLP)-WCP. Lenders with delegated Export Working Capital Program (EWCP) authority will be immediately provided with delegated authority to make 7(a) WCP loans. Lenders who do not maintain delegated EWCP authority may apply for delegated 7(a) WCP status with the requirements outlined in the Program Guide.

Using an innovative fee structure, the WCP provides flexible support for small businesses’ domestic and international capital needs and includes: theTransaction-Based WCP, which will allow small businesses to fund individual projects or orders, enabling access to working capital earlier in the sales cycle; and Asset-Based WCPloans, which will provide small businesses with a cost-effective way to access working capital against their assets, allowing small businesses to better manage their cash flow while also supporting supply chain resiliency. 

The SBA established the Working Capital Pilot Program to create a more flexible loan product to meet the market needs of our nation’s growth-oriented small businesses and give more options to SBA’s network of lenders when structuring a line of credit.