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Anne Marie MehlumAssociate Administrator for Office of Capital AccessSmall Business Administation - Office of Capital Access
FY 14-15: Agency Priority Goal
Increase Active Lender Participation
Priority Goal
Goal Overview
Providing access to capital has been one of the SBA’s critical strategies in meeting its objective to drive business formation, job growth and economic expansion particularly in underserved markets since the agency was created in 1953. By providing loan guarantees to reduce lenders’ loss exposure, the SBA provides an important credit lifeline to small businesses, especially startup businesses and businesses owned by women, minorities, veterans and other underserved groups who often cannot easily obtain credit in the conventional market. In the current economic conditions, SBA loan programs become even more crucial for ensuring that small businesses are not only surviving but also leading the way toward economic recovery and growth, as they have done time-and-time again throughout U.S. history.
SBA will increase small business access to capital by increasing the number of new or returning lenders in the fiscal year for the flagship 7(a) program (including the Community Advantage pilot program). New and returning lenders are a major component of SBA’s lending portfolio and are essential to growth in the quantity of loans approved and small businesses assisted. Each new or returning lender will expand SBA’s footprint and increase small business access to capital. Attaining a high volume of new and returning lenders from one fiscal year to the next will create a consistent pipeline of SBA loans into the hands of small business.
There are barriers and challenges to the SBA in achieving its priority goals:
- Economic Trends; micro and macro
- Issues within the Finance Industry as a whole
- Shrinking workforce in field offices which provide training
- Recent cases from the OIG reviewing SBA lenders underwriting criteria have triggered a more cautious approach from some lenders with some loan guaranty types
Strategies
Two barriers to entering the SBA lending program are program complexities and program fees. By focusing on continuous improvement to the loan programs and reducing borrower and lender fees, SBA will become more attractive to new and returning lenders. Specifically with the issuance of SOP 50 10 5(f) (effective 1/1/2014), the Office of Capital Access made several revisions to its policies to streamline, standardize, and simplify its loan program. Effective 10/1/2013, SBA eliminated borrower and lender fees for all 7(a) loans up to $150,000. Effective 1/1/2014, SBA eliminated borrower and lender fees for SBA Express loans to Veteran owned businesses up to $350,000. These changes will lower the barriers of entry to new and returning banks, especially community banks.
In FY2014 and FY2015, the Office of Capital Access will continue improving the SBA loan programs and will work with trade groups, field offices, technology partners, and lenders themselves to communicate these improvements and assist lenders who are interested in joining SBA’s lending network.
Progress Update
New and returning lenders are a major component of SBA's lending portfolio and are essential to growth in the quantity of loans approved. Attaining a high volume of new and returning lenders from one fiscal year to the next creates a consistent pipeline of SBA loans for small businesses. In FY 2015, SBA added 292 new and returning lenders towards its goal of 325. These new and returning lenders made 752 loans for $260 million. The number of new or returning lenders recruited slowed in the fourth quarter, particularly as fewer active lenders remain in business each year. Bank mergers have also impacted the number of active lending partners providing 7(a) Loans. The priority goal to increase new and returning lenders has reduced the decline from FY 2012 to FY 2014.
While the number of new and returning lenders is under target, the dollars of loans approved for 7(a) loans exceeded the FY 2015 goal. The SBA's 7(a) loan program increased by 23% from previous fiscal year, leading to a record year of approvals. This priority goal has helped expand SBA’s footprint to increase small business access to capital. The SBA lending community has been very responsive to SBA’s strategy of fee relief and loan program improvement. Actions taken to reverse the downward trend:
- Guaranty and servicing fees have been waived for all loans less than $150,000 (Effective 10/1/13 and extended through FY 2015)
- Guaranty and servicing fees have been waived for all SBAEXP loans to veterans less than $350,000 (Effective 1/1/14 and extended through FY 2015)
- 50% of the upfront guaranty fees have been waived for all other loans to veterans (Effective 10/1/14)
- SBA issued SOP 50 10 5(g) to describe new rules and better clarify existing policy for lenders. This SOP eliminates the personal resource test and clarifies SBA policy for several issues including eligibility, credit standard, collateral, and environmental. (Effective 10/1/14)
- SBA issued notice that it would accept electronic signatures for all SBA loan documents. (Effective 1/1/15)
- SBA issued SOP 50 10 5(h) to clarify policies regarding debt refinancing, update appraisal requirements, and simplify the process for delegated lenders to obtain loan increases and decreases.
- SBA entered into MOUs with credit union associations that are committing to join forces with the SBA to provide more loans to small businesses
- Announced MOUs in three events in February with follow-up communication and training from Field and OCA with credit unions
- LINC (lead generator) was implemented connecting lenders with borrowers
Next Steps
No Data Available
Expand All
Performance Indicators
Number of New Lenders
Other Indicators
Number of Approved Loans
Dollar amount of Approved Loans
Contributing Programs & Other Factors
We will provide training to our lenders, via field operations, to ensure streamlined and efficient operations. Trade groups, such as NADCO and NAGGL, will also play a large role in achieving agency objectives. Their assistance in addressing lenders and bringing to light current issues will be paramount in SBA achieving its priority goals. SBA Field Offices will provide training to new or returning lenders on new features in our updated SOPs and all streamline opportunities within the loan programs.
Expand All
Strategic Goals
Strategic Goal:
Growing businesses and creating jobs
Statement:
Growing businesses and creating jobs
Strategic Objectives
Statement:
Expand access to capital through SBA's extensive lending network
Description:
Access to capital is critical to the long-term success of America’s small businesses. The top priority at the SBA is to get lending flowing to small businesses. As the economy continues to improve, the SBA is working to ensure that remaining gaps in the commercial markets are filled and that small businesses across the country are well positioned to take advantage of opportunities. The SBA also continues to streamline and simplify its loan programs to make its products more attractive to lenders and borrowers.
Statement:
Ensure federal contracting goals are me and/or exceeded by collaborating across the federal government to expand opportunities for small businesses and strengthen the integrity of the federal contracting certification process and data.
Description:
Small business contracting is one of the most important federal programs to help America’s small businesses grow and create jobs. The federal government gets to work with the most innovative small businesses in America today, and small businesses get critical revenue to build and scale their operations. SBA’s goal is to make sure that all federal agencies meet or exceed their targets for federal prime contracting dollars awarded to small businesses. The SBA is improving coordination and communication across the federal government, facilitating matchmaking events, increasing online trainings and holding senior officials accountable for meeting their agencies’ small business goals. SBA continues to simplify access to federal contracting opportunities and educate small businesses on the contracting opportunities available to them. The SBA is also streamlining the certification process and data for federal contracting and continues to aggressively root out fraud, waste and abuse in small business contracting to ensure that contracting dollars go to deserving small businesses.
Statement:
Strengthen entrepreneurial ecosystems through a variety of strategic partnerships to provide tailored training, mentoring and counseling services that support entrepreneurs during every phase of their business growth
Description:
Entrepreneurs and small business owners who receive training, mentoring and/or advising services increase sales, create more jobs, and have greater economic impact on their communities. SBA’s resource partner network, including 63 SBDCs with over 900 outreach locations, over 100 WBCs, and 11,000 SCORE volunteers nationwide, along with online training, assists more than one million business owners and entrepreneurs each year. The SBA also leads and builds partnerships with other agencies and private sector partners to support robust entrepreneurial ecosystems across the country. For instance, regional innovation clusters bring together small businesses and entrepreneurs with venture capitalists, universities and regional industry leaders who can help leverage a region’s unique assets to turn entrepreneurial ideas into high-growth small businesses.
Statement:
Enhance the ability of current and future small business exporters to succeed in global markets by expanding access to financing, counseling, training and other export tools
Description:
Export sales contribute to a strong middle class by fueling economic opportunity and jobs in communities across the United States, while the countries buying American products gain access to some of the highest-quality products and services in the world. Today, nearly 96 percent of consumers and over two-thirds of the world's purchasing power reside outside the United States. Small businesses that can tap into this global market have the potential for vast expansion and growth, with small businesses now constituting 34 percent of total export dollars and comprising approximately 97.8 percent of all exporters.
Statement:
Fuel high-growth entrepreneurship, innovation and job creation by providing the tools small businesses need to start and grow their businesses.
Description:
High-growth businesses create almost all of the net new jobs in the economy today. Through longer-term “patient” capital, growth accelerators and regional innovation clusters, federal research and development (R&D) grants, and export assistance, the SBA plays a critical role in the ongoing success of high-growth small businesses. These high-growth investments provide opportunities for small businesses to create jobs and sustain the cycle of American entrepreneurship and innovation.
Statement:
Ensure that SBA’s disaster assistance resources for businesses, non-profit organizations, homeowners, and renters can be deployed quickly, effectively and efficiently in order to preserve jobs and help return small businesses to operation.
Description:
Returning small business operations to normal after a disaster is critical to ensuring that local economies regain traction as quickly as possible and are once again able to contribute to the economy and create jobs. The SBA, in coordination with the U.S. Federal Emergency Management Agency (FEMA), other federal agencies, the American Red Cross and array of state and local entities, helps small businesses prepare for disaster and provides timely and accessible low-cost, low-interest loans to small business owners, non-profits, homeowners, and renters who are survivors of disaster.
Statement:
Ensure the competitiveness and innovation of American manufacturing and supply chains by building capacity and supporting integrated networks of small business suppliers that encourage insourcing and the expansion of U.S. operations
Description:
Across the country, manufacturing and production are coming back to the United States. The reality is that large manufacturers need a diverse and nimble network of small suppliers. These suppliers make large companies more efficient, more productive and more globally competitive. A strong supply chain of small businesses can be a determining factor for locating production in a particular area. To build capacity and depth in America’s small business supply chain, the SBA continues its leadership role in the American Supplier Initiative, an Administration-wide effort focused on investing in — and building capacity throughout — the nation’s small business supply chain through: increased market access for small businesses; counseling and mentoring services to assist small suppliers; ready sources of capital to support sales, and; addressing the skills gap facing many small manufacturers and suppliers.
Agency Priority Goals
Statement:
Expand access to capital by adding 325 new and returning lenders to SBA’s flagship 7(a) program each fiscal year in FY2014-2015.
Description:
Providing access to capital has been one of the SBA’s critical strategies in meeting its objective to drive business formation, job growth and economic expansion particularly in underserved markets since the agency was created in 1953. By providing loan guarantees to reduce lenders’ loss exposure, the SBA provides an important credit lifeline to small businesses, especially startup businesses and businesses owned by women, minorities, veterans and other underserved groups who often cannot easily obtain credit in the conventional market. In the current economic conditions, SBA loan programs become even more crucial for ensuring that small businesses are not only surviving but also leading the way toward economic recovery and growth, as they have done time-and-time again throughout U.S. history.
SBA will increase small business access to capital by increasing the number of new or returning lenders in the fiscal year for the flagship 7(a) program (including the Community Advantage pilot program). New and returning lenders are a major component of SBA’s lending portfolio and are essential to growth in the quantity of loans approved and small businesses assisted. Each new or returning lender will expand SBA’s footprint and increase small business access to capital. Attaining a high volume of new and returning lenders from one fiscal year to the next will create a consistent pipeline of SBA loans into the hands of small business.
There are barriers and challenges to the SBA in achieving its priority goals:
- Economic Trends; micro and macro
- Issues within the Finance Industry as a whole
- Shrinking workforce in field offices which provide training
- Recent cases from the OIG reviewing SBA lenders underwriting criteria have triggered a more cautious approach from some lenders with some loan guaranty types
Statement:
Maximize small business participation in federal government contracting to meet the statutory goals and reduce participation by ineligible firms.
Description:
Congress has mandated that small businesses receive 23% of federal government prime contracting dollars, including 5% of prime and subcontracts to Small Disadvantage Businesses; 5% of prime and subcontracts to Women-Owned Small Businesses; 3% of prime and subcontracts to HUBZone Small Businesses; and 3% of prime and subcontracts to Service-Disabled Veteran-Owned Small Businesses
Meeting and exceeding the federal government’s small business procurement goals continues to be an Administration priority. Federal contracting with small businesses is a win-win. Small businesses get the revenue they need to grow their businesses and create jobs, and the federal government gets the opportunity to work with some of America’s most innovative and nimble small businesses, often times with a direct line to the CEO.
In FY 2012, the federal government made real progress toward the 23 percent goal, with 22.25 percent or $89.9 billion in federal contracting dollars going to small businesses compared to 21.65 percent in FY 2011, with significant impact in key areas:
- For the first time, more agencies than ever before met or surpassed all of their prime contracting goals.
- Also, for the first time, the federal government exceeded the goal for service disabled veterans.
- The federal government had the highest percentage of contracts going to Small Disadvantage Businesses to date.
As a result of a government wide focus on increasing small business contracting opportunities, during President Obama’s first term (FY2009 - FY2012) the federal government awarded $376.2 billion in federal contracting dollars to small businesses. This is a $48.1 billion increase over the four preceding years even as we have seen reduced spending overall.
Also, since President Obama took office, the SBA has supported more than $132.61 billion in Federal government contracting dollars to small disadvantaged businesses. This represents a 36.6 percent increase when compared to the prior Administration. Under the Bush Administration’s first term, $97.10 billion in federal government contracting dollars were awarded to small disadvantaged businesses.
Although we have seen marked success over the last few years, we know more must be done. Many challenges exist for small businesses seeking to enter the federal procurement marketplace.
- The unpredictable and changing budget climate is a challenge for small businesses, and SBA is working hard to create an environment where small businesses can be successful in the federal procurement marketplace.
- The instability and ambiguity caused by Continuing Resolutions make it difficult to agency acquisition staff to plan effectively for small business utilization.
- Entering the federal supply chain can often be a lengthy and arduous process for many small businesses.
SBA’s GCBD unit must implement effective and efficient strategies to monitor the agencies’ progress to goal, support small businesses interested in working with the government and encourage agencies to improve data quality when reporting their contracting activities. SBA will increase its efforts to collaborate with and hold federal agencies accountable to achieving their goals.
Statement:
Expand small business access to export financing by increasing the number of lenders providing export financing solutions from 430 to 555 and the number of small business exporters receiving financing through SBA loan programs from 1,346 to 1,480 by FY2015.
Description:
The priority goal is directly tied to the objective of both the National Export Initiative (NEI) and the Export Promotion Cabinet (EPC) to expand SME access to trade financing, which has been identified as a gap issue for smaller exporters. Increasing access to export financing, combined with trade counseling and training, will contribute to the enhanced ability of current and future U.S. small business exporters to succeed in the global marketplace and supports the cross-agency goal of doubling U.S. exports.
There are barriers and challenges to the SBA in achieving its priority goals:
- From a marketing perspective, communicating and disseminating trade financing information to lenders and small business exporters could provide challenging given current, and anticipated, budget constraints on staffing.
- Inter-agency collaboration and joint initiatives can be challenging to manage, given the differing regulations and performance metrics of individual agencies, which might reduce the commitment of other agencies to help support this priority.
- Unique, and sometimes additional, Standard Operating Procedures (SOP) requirements for core export loans vs. other 7(a) loan products can confuse lenders and may require the creation of “Lender Training Manuals,” more extensive lender training, and Office of Capital Access support in implementing needed SOP revisions.
- In terms of operations, a reduced travel budget could greatly restrict the ability of field staff to deliver the necessary training to lenders and businesses that would expand the use of SBA loan programs for exporters, given that SBA's specialized trade finance specialists cover multiple states.
- The banking sector could receive another “financial shock,” forcing it to tighten lending requirements to small businesses and/or Basel III capital requirements could limit lending capacity.*
- U.S. export growth could slow, reducing demand for trade financing, as a result of slow overseas economic growth and/or a strengthening of the U.S. dollar, making U.S. exports less competitive.
Trade financing historically has been perceived by many lenders, especially community banks, as being too complex to be incorporated into their suite of financial products. Working with other federal agencies, SBA will help reduce the complexity of USG trade financing and export marketing programs and highlight the growing importance of exports to the U.S. economy, thereby encouraging more lenders to offer comprehensive business solutions to their export customers. In addition, SBA will leverage its outreach by working with state, federal, and other resource partners in order to promote customized trade financing options to the small business exporting community.
Statement:
Increase the return rate for disaster survivor applications by 10 percent points from 24% to 34% return rate by September 30, 2015.
Description:
The FY13 baseline number for Disaster Loan Application Return Rate was 24%, so the goal for FY14 is to achieve 29% and 34% in FY15. Increasing the application return rate will improve the delivery of the Disaster Loan Program. The primary opportunity being addressed is that a higher application return rate should result in a greater number of disaster survivors that will apply for disaster loan assistance and receive much needed Federal disaster assistance. SBA’s plan to increase the application return rate also ensures that SBA's disaster assistance resources for businesses, non-profit organizations, homeowners, and renters can be deployed quickly, effectively and efficiently in order to preserve jobs and help return small businesses to operation.
SBA’s plan to increase the application return rate will indirectly make the Disaster Loan Program more efficient by: 1) saving costs on mailing application packets to 100% of disaster survivors referred to SBA; and 2) freeing up resources dedicated to preparing and mailing application packets that can be utilized in other critical areas of the application screening process that directly impact processing times.
Strategic Goal:
Serving as the voice for small business
Statement:
Serving as the Voice for Small Business
Strategic Objectives
Statement:
Ensure inclusive entrepreneurship by expanding access and opportunity to small businesses and entrepreneurs in communities where market gaps remain
Description:
Underserved communities – including women, low-income, minorities, veteran entrepreneurs – often have extreme difficulty in accessing capital, training, advising, and mentoring services and federal contracts. SBA’s unique approach to inclusive entrepreneurship provides products, services and programs that offer a path to business ownership for these populations that also suffer from disproportionately high levels of unemployment. The SBA will continue to work collaboratively with community development partners, credit unions, minority associations and others to tailor programs to meet their needs and ensure that SBA’s programs remain accessible to underserved communities.
Statement:
Lead and collaborate with other agencies to strengthen and streamline the delivery of programs, resources and services for small businesses.
Description:
The SBA is the voice of small business and works to advocate for the interests of small business owners and entrepreneurs across government agencies. In this capacity, the Agency takes a leadership role in ensuring effective delivery of federal small business programs and services, collaborating across a broad array of agencies. The Agency is a leading participant in interagency collaborations that focus on innovation, place-based and sector-based growth, government contracting, veterans and reservists, disaster recovery, access to capital for small business owners and entrepreneurial education. The SBA will continue to foster interagency collaborations that leverage and align Agency activities across the federal government to reach more small businesses more efficiently than ever before.
Statement:
Provide timely, instructive and useful information to the small business community through SBA’s extensive digital and in-person outreach efforts.
Description:
The SBA works to ensure that small business entrepreneurs can effectively access and navigate small business programs across the federal government. In an increasingly tech-driven economy, the SBA has taken significant steps to upgrade and enhance its website to better meet the needs of small businesses and give entrepreneurs more ways to access the Agency’s tools and resources. The SBA co-leads the BusinessUSA initiative with the Department of Commerce to provide small businesses with an easy-to-use, consolidated website and toll-free telephone number for the many government small business resources found in other agencies. The SBA leverages its nationwide network of field offices and resource partners to conduct outreach to hundreds of thousands of small business owners.
Statement:
Foster a small business-friendly environment by encouraging federal agency awareness about the impact of unfair regulatory enforcement and compliance efforts, reducing burdens on small business and improving small business research
Description:
The SBA plays a critical role in the Administration’s ongoing efforts to reduce regulatory barriers to entrepreneurship, innovation, and American competitiveness. As part of the Start-Up America initiative, government leaders met with more than 1,000 entrepreneurs across the country to talk about ways to reduce barriers for small business growth. These conversations continue to guide SBA policy and programmatic decisions. In addition, SBA’s National Ombudsman plays a key role in helping small business owners deal with specific regulatory burdens and challenges that result from federal agency processes. Furthermore, the SBA is focused on and committed to not only compiling internal SBA data to inform programmatic decisions, but also partnering with the key federal agencies to gather the most robust data sets to make informed policy.
Agency Priority Goals
Statement:
Expand access to capital by adding 325 new and returning lenders to SBA’s flagship 7(a) program each fiscal year in FY2014-2015.
Description:
Providing access to capital has been one of the SBA’s critical strategies in meeting its objective to drive business formation, job growth and economic expansion particularly in underserved markets since the agency was created in 1953. By providing loan guarantees to reduce lenders’ loss exposure, the SBA provides an important credit lifeline to small businesses, especially startup businesses and businesses owned by women, minorities, veterans and other underserved groups who often cannot easily obtain credit in the conventional market. In the current economic conditions, SBA loan programs become even more crucial for ensuring that small businesses are not only surviving but also leading the way toward economic recovery and growth, as they have done time-and-time again throughout U.S. history.
SBA will increase small business access to capital by increasing the number of new or returning lenders in the fiscal year for the flagship 7(a) program (including the Community Advantage pilot program). New and returning lenders are a major component of SBA’s lending portfolio and are essential to growth in the quantity of loans approved and small businesses assisted. Each new or returning lender will expand SBA’s footprint and increase small business access to capital. Attaining a high volume of new and returning lenders from one fiscal year to the next will create a consistent pipeline of SBA loans into the hands of small business.
There are barriers and challenges to the SBA in achieving its priority goals:
- Economic Trends; micro and macro
- Issues within the Finance Industry as a whole
- Shrinking workforce in field offices which provide training
- Recent cases from the OIG reviewing SBA lenders underwriting criteria have triggered a more cautious approach from some lenders with some loan guaranty types
Statement:
Maximize small business participation in federal government contracting to meet the statutory goals and reduce participation by ineligible firms.
Description:
Congress has mandated that small businesses receive 23% of federal government prime contracting dollars, including 5% of prime and subcontracts to Small Disadvantage Businesses; 5% of prime and subcontracts to Women-Owned Small Businesses; 3% of prime and subcontracts to HUBZone Small Businesses; and 3% of prime and subcontracts to Service-Disabled Veteran-Owned Small Businesses
Meeting and exceeding the federal government’s small business procurement goals continues to be an Administration priority. Federal contracting with small businesses is a win-win. Small businesses get the revenue they need to grow their businesses and create jobs, and the federal government gets the opportunity to work with some of America’s most innovative and nimble small businesses, often times with a direct line to the CEO.
In FY 2012, the federal government made real progress toward the 23 percent goal, with 22.25 percent or $89.9 billion in federal contracting dollars going to small businesses compared to 21.65 percent in FY 2011, with significant impact in key areas:
- For the first time, more agencies than ever before met or surpassed all of their prime contracting goals.
- Also, for the first time, the federal government exceeded the goal for service disabled veterans.
- The federal government had the highest percentage of contracts going to Small Disadvantage Businesses to date.
As a result of a government wide focus on increasing small business contracting opportunities, during President Obama’s first term (FY2009 - FY2012) the federal government awarded $376.2 billion in federal contracting dollars to small businesses. This is a $48.1 billion increase over the four preceding years even as we have seen reduced spending overall.
Also, since President Obama took office, the SBA has supported more than $132.61 billion in Federal government contracting dollars to small disadvantaged businesses. This represents a 36.6 percent increase when compared to the prior Administration. Under the Bush Administration’s first term, $97.10 billion in federal government contracting dollars were awarded to small disadvantaged businesses.
Although we have seen marked success over the last few years, we know more must be done. Many challenges exist for small businesses seeking to enter the federal procurement marketplace.
- The unpredictable and changing budget climate is a challenge for small businesses, and SBA is working hard to create an environment where small businesses can be successful in the federal procurement marketplace.
- The instability and ambiguity caused by Continuing Resolutions make it difficult to agency acquisition staff to plan effectively for small business utilization.
- Entering the federal supply chain can often be a lengthy and arduous process for many small businesses.
SBA’s GCBD unit must implement effective and efficient strategies to monitor the agencies’ progress to goal, support small businesses interested in working with the government and encourage agencies to improve data quality when reporting their contracting activities. SBA will increase its efforts to collaborate with and hold federal agencies accountable to achieving their goals.
Statement:
Increase the return rate for disaster survivor applications by 10 percent points from 24% to 34% return rate by September 30, 2015.
Description:
The FY13 baseline number for Disaster Loan Application Return Rate was 24%, so the goal for FY14 is to achieve 29% and 34% in FY15. Increasing the application return rate will improve the delivery of the Disaster Loan Program. The primary opportunity being addressed is that a higher application return rate should result in a greater number of disaster survivors that will apply for disaster loan assistance and receive much needed Federal disaster assistance. SBA’s plan to increase the application return rate also ensures that SBA's disaster assistance resources for businesses, non-profit organizations, homeowners, and renters can be deployed quickly, effectively and efficiently in order to preserve jobs and help return small businesses to operation.
SBA’s plan to increase the application return rate will indirectly make the Disaster Loan Program more efficient by: 1) saving costs on mailing application packets to 100% of disaster survivors referred to SBA; and 2) freeing up resources dedicated to preparing and mailing application packets that can be utilized in other critical areas of the application screening process that directly impact processing times.
Strategic Objectives
Strategic Objective:
Statement:
Expand access to capital through SBA's extensive lending network
Description:
Access to capital is critical to the long-term success of America’s small businesses. The top priority at the SBA is to get lending flowing to small businesses. As the economy continues to improve, the SBA is working to ensure that remaining gaps in the commercial markets are filled and that small businesses across the country are well positioned to take advantage of opportunities. The SBA also continues to streamline and simplify its loan programs to make its products more attractive to lenders and borrowers.
Agency Priority Goals
Statement: By September 30, 2017, expand access to capital for small businesses by increasing the number of lenders in SBA's 7(a) loan program from 2,244 (FY 2014) to 2,500.
Description: Providing access to capital has been one of the SBA’s critical strategies in meeting its objective to drive business formation, job growth, and economic expansion particularly in underserved markets since the Agency’s creation in 1953. By providing loan guarantees to reduce lenders’ loss exposure, the SBA provides an important credit lifeline to small businesses, especially startup businesses and businesses owned by women, minorities, veterans and other underserved groups that often cannot easily obtain credit in the conventional market. SBA loan programs are necessary to ensure that small businesses are not only surviving but also leading the way toward US economic expansion and growth. The 7(a) Loan program is the federal government’s primary small business loan program, assisting small businesses to obtain financing when they do not qualify for or otherwise have access to traditional credit. The SBA guarantees a portion of each loan (typically 50 to 90%) that participating lenders make by using the adjusted credit standards of the 7(a) loan program. SBA's FY 2014-2015 Priority Goal to increase new and returning 7(a) lenders has reduced the decline from FY 2012 to FY 2014. SBA will continue to support small business access to capital by increasing the number of lenders participating in the flagship 7(a) loan program (including the Community Advantage pilot program). Lender participation is essential to growth in the quantity of loans approved and small businesses assisted. Attaining a high volume of lender participation will create a consistent pipeline of SBA loans to small businesses. This Priority Goal directly supports SBA’s Strategic Objective 1.1 – Expand access to capital through SBA’s extensive lending network. Access to capital is critical to the long-term success of America’s small businesses. The top priority at the SBA is to get lending flowing to small businesses. Key barriers and challenges:
Statement: Expand access to capital by adding 325 new and returning lenders to SBA’s flagship 7(a) program each fiscal year in FY2014-2015.
Description: Providing access to capital has been one of the SBA’s critical strategies in meeting its objective to drive business formation, job growth and economic expansion particularly in underserved markets since the agency was created in 1953. By providing loan guarantees to reduce lenders’ loss exposure, the SBA provides an important credit lifeline to small businesses, especially startup businesses and businesses owned by women, minorities, veterans and other underserved groups who often cannot easily obtain credit in the conventional market. In the current economic conditions, SBA loan programs become even more crucial for ensuring that small businesses are not only surviving but also leading the way toward economic recovery and growth, as they have done time-and-time again throughout U.S. history. SBA will increase small business access to capital by increasing the number of new or returning lenders in the fiscal year for the flagship 7(a) program (including the Community Advantage pilot program). New and returning lenders are a major component of SBA’s lending portfolio and are essential to growth in the quantity of loans approved and small businesses assisted. Each new or returning lender will expand SBA’s footprint and increase small business access to capital. Attaining a high volume of new and returning lenders from one fiscal year to the next will create a consistent pipeline of SBA loans into the hands of small business. There are barriers and challenges to the SBA in achieving its priority goals:
Strategic Objective:
Statement:
Enhance the ability of current and future small business exporters to succeed in global markets by expanding access to financing, counseling, training and other export tools
Description:
Export sales contribute to a strong middle class by fueling economic opportunity and jobs in communities across the United States, while the countries buying American products gain access to some of the highest-quality products and services in the world. Today, nearly 96 percent of consumers and over two-thirds of the world's purchasing power reside outside the United States. Small businesses that can tap into this global market have the potential for vast expansion and growth, with small businesses now constituting 34 percent of total export dollars and comprising approximately 97.8 percent of all exporters.
Agency Priority Goals
Statement: Expand small business access to export financing by increasing the number of lenders providing export financing solutions from 430 to 555 and the number of small business exporters receiving financing through SBA loan programs from 1,346 to 1,480 by FY2015.
Description: The priority goal is directly tied to the objective of both the National Export Initiative (NEI) and the Export Promotion Cabinet (EPC) to expand SME access to trade financing, which has been identified as a gap issue for smaller exporters. Increasing access to export financing, combined with trade counseling and training, will contribute to the enhanced ability of current and future U.S. small business exporters to succeed in the global marketplace and supports the cross-agency goal of doubling U.S. exports. There are barriers and challenges to the SBA in achieving its priority goals: Trade financing historically has been perceived by many lenders, especially community banks, as being too complex to be incorporated into their suite of financial products. Working with other federal agencies, SBA will help reduce the complexity of USG trade financing and export marketing programs and highlight the growing importance of exports to the U.S. economy, thereby encouraging more lenders to offer comprehensive business solutions to their export customers. In addition, SBA will leverage its outreach by working with state, federal, and other resource partners in order to promote customized trade financing options to the small business exporting community.
Strategic Objective:
Statement:
Ensure inclusive entrepreneurship by expanding access and opportunity to small businesses and entrepreneurs in communities where market gaps remain
Description:
Underserved communities – including women, low-income, minorities, veteran entrepreneurs – often have extreme difficulty in accessing capital, training, advising, and mentoring services and federal contracts. SBA’s unique approach to inclusive entrepreneurship provides products, services and programs that offer a path to business ownership for these populations that also suffer from disproportionately high levels of unemployment. The SBA will continue to work collaboratively with community development partners, credit unions, minority associations and others to tailor programs to meet their needs and ensure that SBA’s programs remain accessible to underserved communities.
Agency Priority Goals
Statement: Expand access to capital by adding 325 new and returning lenders to SBA’s flagship 7(a) program each fiscal year in FY2014-2015.
Description: Providing access to capital has been one of the SBA’s critical strategies in meeting its objective to drive business formation, job growth and economic expansion particularly in underserved markets since the agency was created in 1953. By providing loan guarantees to reduce lenders’ loss exposure, the SBA provides an important credit lifeline to small businesses, especially startup businesses and businesses owned by women, minorities, veterans and other underserved groups who often cannot easily obtain credit in the conventional market. In the current economic conditions, SBA loan programs become even more crucial for ensuring that small businesses are not only surviving but also leading the way toward economic recovery and growth, as they have done time-and-time again throughout U.S. history. SBA will increase small business access to capital by increasing the number of new or returning lenders in the fiscal year for the flagship 7(a) program (including the Community Advantage pilot program). New and returning lenders are a major component of SBA’s lending portfolio and are essential to growth in the quantity of loans approved and small businesses assisted. Each new or returning lender will expand SBA’s footprint and increase small business access to capital. Attaining a high volume of new and returning lenders from one fiscal year to the next will create a consistent pipeline of SBA loans into the hands of small business. There are barriers and challenges to the SBA in achieving its priority goals:
Statement: Maximize small business participation in federal government contracting to meet the statutory goals and reduce participation by ineligible firms.
Description: Congress has mandated that small businesses receive 23% of federal government prime contracting dollars, including 5% of prime and subcontracts to Small Disadvantage Businesses; 5% of prime and subcontracts to Women-Owned Small Businesses; 3% of prime and subcontracts to HUBZone Small Businesses; and 3% of prime and subcontracts to Service-Disabled Veteran-Owned Small Businesses Meeting and exceeding the federal government’s small business procurement goals continues to be an Administration priority. Federal contracting with small businesses is a win-win. Small businesses get the revenue they need to grow their businesses and create jobs, and the federal government gets the opportunity to work with some of America’s most innovative and nimble small businesses, often times with a direct line to the CEO. In FY 2012, the federal government made real progress toward the 23 percent goal, with 22.25 percent or $89.9 billion in federal contracting dollars going to small businesses compared to 21.65 percent in FY 2011, with significant impact in key areas: As a result of a government wide focus on increasing small business contracting opportunities, during President Obama’s first term (FY2009 - FY2012) the federal government awarded $376.2 billion in federal contracting dollars to small businesses. This is a $48.1 billion increase over the four preceding years even as we have seen reduced spending overall. Also, since President Obama took office, the SBA has supported more than $132.61 billion in Federal government contracting dollars to small disadvantaged businesses. This represents a 36.6 percent increase when compared to the prior Administration. Under the Bush Administration’s first term, $97.10 billion in federal government contracting dollars were awarded to small disadvantaged businesses. Although we have seen marked success over the last few years, we know more must be done. Many challenges exist for small businesses seeking to enter the federal procurement marketplace. SBA’s GCBD unit must implement effective and efficient strategies to monitor the agencies’ progress to goal, support small businesses interested in working with the government and encourage agencies to improve data quality when reporting their contracting activities. SBA will increase its efforts to collaborate with and hold federal agencies accountable to achieving their goals.
