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SBA’s 7(a) Loan Program Reaches Cap - WIPP and CP Letter to Senate Small Business Committee

Friday, July 24, 2015  
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July 23, 2015


Dear Member of Congress, 


The undersigned organizations are writing to support Senate action to raise the cap on the SBA 7(a) lending program.  


The 7(a) program is an important source of capital for entrepreneurs.  According to SBA in FY2014 the lending program approved 52,044 7(a) loans totaling $19.2 billion. SBA’s statistics show that in FY2014, 28.9% of 7(a) loan approvals ($5.54 billion of $19.19 billion) were to minority-­‐owned businesses (21.3% Asian, 5.3% Hispanic, 1.8% African American, 0.5% American Indian, and 0.01% multi-­‐group) and 13.3% were to women-­‐owned businesses.  


According to a CRS analysis, “loans under the 7(a) and 504 programs were more likely to be made to minority-­‐owned, women-­‐owned, and start-­‐up businesses (firms that have historically faced capital gaps) as compared to conventional small business loans. Moreover, the average amounts for loans made under the 7(a) and 504 programs to these types of firms were substantially greater than conventional small business loans to such firms.”1  This shows that the 7(a) program is helping to fill a much needed lending gap.   


Earlier this year, the Senate Small Business & Entrepreneurship Committee passed legislation  to increase the current authorization of $18.75 billion.  However, the pace of 7(a) lending will exceed that cap sometime in August or sooner.  The legislation we support would raise the lending cap to $23.5 billion, as requested by the Office of Management and Budget.  If Congress does not increase the cap, the SBA will be forced to suspend lending under the program until  the beginning of the next fiscal year October 1.  This disruption would put many small businesses in lending limbo or inability to operate or expand their businesses while waiting for the Congress to act.


We urge you to support this legislation.  Small businesses continue to struggle with access to capital.  Lifting the lending cap for the 7(a) program is vitally important for the small business community.




Association for Enterprise Opportunity Association of Women’s Business Center

California Association for Micro Enterprise Opportunity Minority Business RoundTable

Montgomery County Chamber of Commerce

National Association for Female Executives                                                                                      

National Association for the Self-­‐Employed

National Development Council Grow America Fund

National Gay & Lesbian Chamber of Commerce

National Small Business Association

National Women Business Owners Corporation

Small Business California

Small Business & Entrepreneurship Council

Small Business Majority

U.S. Black Chambers, Inc.  

Women Impacting Public Policy


1 Congressional Research Service, “Small Business Administration 7(a) Loan Guaranty Program.” 2015. Available at­‐content/uploads/assets/crs/R41146.pdf


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