Small Business Association (SBA)
What does it mean
The Small Business Association (SBA) is a government entity with the purpose of fostering small business growth by reducing credit risk for banks to encourage lending.
Why does it matter
For a Community Banker, SBA seeks to fulfill tits mission through two main programs: 7a and 504 (stupid names, I know :). Under the 7a program, the SBA provides a loan guarantee to the bank, and under the 504, the SBA provides direct funding to the borrower. What both programs attempt to do is to bridge the gap between the financial strength of the borrower and the requirements of a banker. Through these programs, SBA encourages additional business loans to occur that otherwise, without their help, may not occur. For a community banker, these programs not only provide a good risk mitigation tool, but it can also provide an attractive financing program for potential borrowers as well.
Other Relevant Terms
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A bit about me
Greetings! I'm Clay Sharkey, and there is nothing I like more than assisting others in achieving their goals. I firmly believe that by enhancing a banker's understanding of their customer's' business, they can provide superior service. This superior service, in turn, leads to stronger relationships for the bank, improved performance for the businesses, and better experiences for our communities. Win-win-win.
