Updated June 1997

The SBA provides financial and business development assistance to help small businesses in developing export markets through:

- Loan guaranties.
- Working capital.

SBA Requirements

SBA programs are for U.S. small businesses.
- The SBA defines a small business as an independently owned and operated for-profit business that does not dominate the market in which it exists.

The applicant must first seek a loan from a bank or other lending institution.
- If the lender is unable or unwilling to provide the financing directly, the lender should be encouraged to contact the nearest SBA field office.

Because SBA programs are guaranty programs, they require participation of an eligible commercial bank.

SBA Facilities

Loans

(i) Regular Business Loan Program
Under this program, the SBA can guarantee up to 80 percent of a bank loan up to $100,000. For larger loans, the maximum guaranty is 75 percent or $750,000, whichever is less.

Small businesses that need money for fixed asset or term working capital may be eligible for the SBA's regular 7(a) Loan Guaranty Program. Loan guaranties for fixed-asset acquisition have a maximum maturity of 25 years. Guaranties for general purpose working capital loans have a maximum of seven years.

To be eligible, the applicant's business generally must be operated for profit and fall within size standards set by SBA. Export trading companies and export management companies also may qualify for the SBA's business loan guarantee program. Ineligible borrowers include businesses engaged in speculation or investment in rental real estate.

(ii) International Trade Loans
The International Trade Loan Program provides long-term financing to help small businesses compete more effectively and to expand or develop export markets.

Under this program, SBA's guaranty can extend up to $1.25 million. SBA's maximum share for facilities and equipment is $1 million; the maximum share for working capital is $750,000. Loan maturities cannot exceed 25 years, excluding the working capital portion of the loan.

Proceeds may be used to purchase or upgrade facilities or equipment, and to make other improvements that will be used within the United States to produce goods or services.

No debt payment is allowed. Proceeds can be used to buy land and building; build new facilities; renovate, improve or expand existing facilities; and purchase or recondition machinery, equipment and fixture. The working capital portion of the borrowing could be in the form of either an Export Working Capital Program loan or a portion of the term loan.

Applicants must establish either of the following to meet eligibility requirements:

- Loan proceeds must significantly expand existing export markets or develop new ones, OR
- the applicant's business is adversely affected by import competition.

Export Working Capital Program

The Export Working Capital Programs (EWCP) helps small businesses obtain working capital to complete export sales. The EWCP can support single transactions or multiple export sales. Under this program, SBA can guarantee up to 90 percent or $750,000, whichever is less, of a private-sector loan. Loan maturities are general for 12 months; revolving credit lines may be renewed twice, up to a total of 36 months.

Guarantees can be extended for pre-shipment working capital, post-shipment exposure, or a combination of the two. A pre-shipment guarantee is used to finance the production or acquisition of goods and services for export. A post-shipment guaranty is used to finance receivables resulting from export sales.

Under EWCP, the maximum interest rates are negotiable between the applicant and the lender.

U.S. Export Assistance Centers (USEACs)

USEACs offer a full range of federal export programs and services under one roof. Clients receive assistance by professionals from the SBA, Department of Commerce, Ex-Im Bank, and other public and private organizations. Each USEAC, located in 15 cities nationwide, can provide clients with assistance in: export marketing and trade finance; customized counseling tailored to the company's experience and commitment to exporting; and service with the latest technology to bring assistance to the customer's doorstep. The SBA is a fully committed, participating partner in each USEAC nationwide.

Additional SBA Programs

SBA also maintains a Small Business Investment Company (SBIC) financing program that provides equity capital and management assistance, and other programs such as: the Small Business Development Centers (SBDC); Export Legal Assistance Network (ELA); and the Service Corps of Retired Executives (SCORE) to help entrepreneurs expand their business through exporting.

For more information, SBA has offices located throughout the U.S. and its territories. Local offices are listed under "U.S. Government" in the telephone directory. Small business customers may also call the Small Business Answer Desk at (800) 8-ASK-SBA. You may also reach SBA by fax at (202) 205-7064, by TDD at (202) 205-7333. The electronic bulletin board SBA OnLine is available at (800) 697-4636 (limited access) or (900) 463-4636 (full access). The SBA Home Page is at http://www.sbaonline.sba.gov. The SBA Office of International Trade's Home Page is at http://www.sba.gov/oit.