Demand for SBA Financing: March Sees Big Jump

$64.2 million to Small Businesses in Past 6 Months, Access to Needed Capital Creates Nearly 900 New Jobs Across the State
Release Date: 
Wednesday, April 8, 2015
Michael Foutch

Omaha, NE – The number of small business loans financed through the SBA continues to be crucial to start-up and existing firms across Nebraska by providing needed access to capital in the first half of Fiscal 2015, ending March 31.

Over the past six months, the SBA, working with its commercial lender partners, approved 197 loans for $64.2 million in volume. In March alone, small businesses in Nebraska were approved for $16.4 million in SBA guaranteed loans, a positive trend after another bitterly cold winter, and fully one quarter of the loan volume this year to date.

The SBA continued its effort eliminating up-front fees for borrowers for loans $150,000 and less, saving borrowers up to $2,500 in fees on a loan of that size.  Eliminating these up-front fees has maintained demand from small business owners for SBA-guaranteed financing for their start-up and expansion projects, according to SBA Nebraska District Director Leon Milobar.  Through the first half of Fiscal 2015, the SBA has approved 128 loans for $150,000 or less, 65 percent of approvals throughout the state.  By way of comparison, last year, loans of this size and smaller made up just over half of all approvals.

Partly as a result of these efforts to reach underserved communities, the largely rural Third Congressional District in Nebraska in the past six months saw 58 SBA loan approvals and $17 million in volume.  That's a 38 percent increase in number of loans and a 36 percent bump in dollar volume for that area of the state from the same time last year.

In a continuing strong sign of confidence in Nebraska’s entrepreneurial economy, 48 percent of all SBA loan approvals in the first half went to fund new businesses.  At the same time last year, only 41 percent of approvals went to new businesses.

The SBA, working with banks and credit unions across the state, approved $11.3 million to wholesale trade businesses in the first six months of the fiscal year; $9.2 million in loan volume for those in the health care and social assistance industry; and $9 million for firms in accommodation and food services; and, $6.1 million to manufacturing firms.  The largest SBA guaranteed loan in the first six months under the standard 7(a) program, for $5 million, was approved through the Bank of Bennington for a medical software development and integration firm in Omaha.  The smallest loan amounts, for $5,000, were for lines of credit approved through Wells Fargo for an amusement and recreation business in Wallace and an e-cigarette shop in Lincoln.

Moreover, as a direct result of SBA-guaranteed small business financing throughout the state over the past six months, nearly 900 new jobs are being created in Nebraska, and 1,200 jobs are being kept on payrolls.  

SBA-backed loans represent one third of all small business lending nationwide and these loans are closely monitored as an indicator of lenders’ willingness to extend access to capital to Main Street companies.