Administrator Isabel Casillas Guzman, head of the U.S. Small Business Administration (SBA) and the voice in President Biden’s Cabinet for America’s more than 33 million small businesses, announced that SBA 7(a) lenders may now accept applications for the SBA’s newly-announced 7(a) Working Capital Pilot (WCP) Program.
“Small businesses need affordable working capital to pursue revenue growth opportunities made available thanks to President Biden’s Investing in America agenda,” said 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. The Biden-Harris Administration continues to level the playing field and ensure small businesses can compete, create jobs, and strengthen our nation’s economy.”
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.
Using an innovative fee structure, the WCP provides flexible support for small businesses’ domestic and international capital needs and includes: the Transaction-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 WCP loans, 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.
