The Small Business Administration (SBA) has taken a significant step forward in expanding access to capital for small businesses by authorizing four new Small Business Lending Companies (SBLCs). This historic expansion, only the second in over 40 years, increases the number of SBLCs from 14 to 20, creating new opportunities for entrepreneurs seeking funding through the SBA’s 7(a) loan program.
The newly licensed institutions — Cooperative Business Services, A10 Capital, Lafayette Square, and Stonehenge Capital — will focus specifically on delivering capital to underserved communities across the United States. Each lender brings unique expertise and commitments to supporting specific business segments, including women-owned businesses, veteran-owned enterprises, and businesses in low-income and rural areas. This expansion is particularly significant because these non-depository lenders can now offer government-backed loans that reduce risks for lenders while lowering costs for borrowers.
This development represents a major shift in small business lending accessibility, especially for entrepreneurs who have historically faced barriers to traditional financing. The program’s focus on sustainability initiatives, with some lenders committing significant portions of their loan volume to green projects, also signals a forward-thinking approach to small business development. For entrepreneurs seeking funding in 2024, these new lending channels could provide vital access to capital needed for starting, operating, or expanding their businesses, particularly in communities that traditional financial institutions have often overlooked.
For more detailed guidance on SBA Guaranteed Loans, check out Bigger Bottom Line’s “Ultimate Guide to Small Business SBA Loans” here.