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What Is Small Business Administration (SBA)? — The Top Guide

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Introduction to the Small Business Administration

Established in 1953, the Small Business Administration (SBA) is an autonomous U.S. government agency that provides assistance to small businesses it was formed with an intent to support and promote the economy in general.

SBA provides the facility of counseling to aid individuals who are trying to start and grow their businesses.

The small business administration website has many tools to assist small businesses in the form of a small business planner and additional training programs.

Across the United States of America, localized SBA offices and associated territories offer physical, one-on-one counseling services that include business plan writing instruction, along with assistance for small business loans.

The administrator and deputy administrator head the SBA, and also it has a chief counsel for advocacy and inspector general, all of which are confirmed by the Senate.

There is at least one office of Small Business Administration in every state. Isabel Guzman is the current administrator of the SBA.


Knowing more about the Small Business Administration

Substantial educational information along with a specific focus on assisting small business startups and growth is offered by the Small Business Administration.

Along with educational events for small business owners by the agency, more personalized special events are provided by the local offices.


According To The SBA Website,

The Services Provided By Them To Small Businesses Are

  • Access to capital — The Small Business Administration offers a variety of financial resources for small businesses along with microlending, or small loans that are issued to those who otherwise cannot qualify for financing.
  • Entrepreneurial development — The counseling services and low-cost training provided by the SBA to small businesses. This facility is made available for both the new and existing business owners.
  • Contracting — With the help of other federal departments and agencies 23% in government contracting dollars are reserved for small businesses by the SBA.
  • Advocacy — In the whole of the U.S, the SBA acts as an advocate by reviewing legislation and protecting the interests of small business owners.

The History Of Small Business Administration

In the summer of 1953, President Eisenhower established The SBA when he signed the Small Business Act.

In its more than sixty years of existence, the SBA has been threatened in many instances.

In 1996 the House of Representatives, controlled by the Republicans, had the SBA slated to be eliminated. But, it survived this and many threats and went on to receive a record budget in 2000.

Another threat was faced by the SBA from President Bush and his administration. Many attempts were taken to cut the agency’s loan program repeatedly every year from 2001 to 2004, and some SBA expenditures were jammed altogether.


More About The SBA Loan Program

The loan programs offered by the SBA are among the most visible elements provided by the agency.

Except for disaster relief loans, the small business administration does not offer grants or direct loans, and if the businesses meet the agency’s guidelines they are provided with guarantees against default pieces of business loans provided by banks and other official lenders.

The SBA loan programs make it possible for small businesses to get loans with longer repayment periods.

Loans by the SBA include a 504 Loan which at times is called a growing loan. Finances are provided by Grow loans to small businesses so that they can buy some of the fixed assets like real estate to run their operations.

On the other hand, the 7(a) loan is the SBA’s primary loan program. $5 million is the maximum loan amount guaranteed under this program.


Other SBA-guaranteed Loan Programs Are

  • Express loan
  • CAPLines loan
  • Disaster loan
  • Export loan
  • Microloan

The SBA acts as a guarantor to these loans which are generally provided by financial institutions.

When guaranteed by the Small Business Administration, small businesses qualify for loans more easily.

Entrepreneurs can also make lower payments for a longer period of time with the help of the agency.


Conclusion

SBA is a government agency that provides assistance to small businesses and promotes the economy.

The Small Business Administration a variety of resources to small businesses government contracting, entrepreneurial development, access to capital, and advocacy services.

Even after many attempts were taken to abolish the SBA entirely, many political officials and offices continue to support the agency.

The American Recovery and Reinvestment Act of 2009 and the Small Business Jobs Act of 2010 have significantly strengthened SBA’s ability to offer loans.


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