SBA Helped Minnesota Small Businesses Access More Than $682 Million to Start, Grow and Expand in FY 19

Nationally, SBA backed more than 63,000 small business loans totaling $28+ billion in FY 19
Release Date: 
Tuesday, October 22, 2019
Release Number: 
20.4.MN
Contact: 
sarah.swenty@sba.gov

MINNEAPOLIS – The U.S. Small Business Administration’s Minnesota District helped the state’s small businesses access more than $682 million in capital via its various loan programs in fiscal year 2019, which ended on September 30, 2019. Across the nation, the federal agency backed more than $28 billion in loans to entrepreneurs who, without the SBA, would otherwise be unable to access loans at reasonable rates.

“Even with a strong economy in which banks have more comfort with conventional lending, small businesses can still struggle to access to the funds they need to start, grow and expand,” SBA Great Lakes Regional Administrator Rob Scott said. “All businesses start small and our work in this region is essential for empowering local job creators and supporting them in their contributions to economic development and innovation.”

Here in Minnesota, the SBA backed approximately 1,890 loans. Of note was a rise in SBA 504 loans that help small businesses get long-term, fixed-interest capital to acquire fixed assets such as real estate, additional machinery, equipment and construction efforts. This type of financing assists small businesses with maximizing cash flow as they grow and promotes economic development. Minnesota SBA 504 loans topped $188 million, an increase of 17% over FY 18. Nationally, SBA saw 504 loans reaching a total of almost $5 billion – a 4% growth over FY 18.

“One of our top goals here in Minnesota, and an SBA core priority, is to get more capital into the hands of entrepreneurs to assist with their growth and expansion,” SBA Minnesota District Director Nancy Libersky said. “In support of SBA’s partnership with USDA, here in Minnesota we made a concerted effort to get capital to small businesses in the state’s rural areas as well.”

Minnesota’s 760 rural SBA-backed loans accounted for 40% of the state’s loans and totaled more than $202 million in FY 19. SBA’s Minnesota 2019 Rural Lender of the Year, Entrepreneur Fund, which serves northeast and central Minnesota, is one example of the strong community lending atmosphere supporting these numbers. Using multiple SBA programs, as well as strong partnerships with banks and other economic development organizations, the Entrepreneur Fund consistently ranks as one of the country’s top 20 SBA microlenders. In FY 19 it originated 56% of the state’s SBA microloans while serving only 6% of the Minnesota’s population.

This effort contributed to a rise in the state’s SBA microloans as well, which totaled nearly $4.1 million, a more than $500,000 increase from FY 18. Nationally, SBA’s Microloan amounts also rose and achieved a record total level, helping approximately 5,500 small businesses, typically start-up and under-represented entrepreneurs, access over $81.5 million. This program offers loans to not-for-profit lending intermediaries that, in turn, make up to $50,000 loans to small businesses on reasonable terms. The average microloan is approximately $14,800 and can be essential for providing newly forming businesses with solid capital footing.

In addition to its beneficial loan programs, SBA’s Lender Match platform has helped connect   entrepreneurs with SBA-approved lenders within 48 hours via a quick online form without registration or cost to the user. To date, Lender Match has generated 4.4 million small business leads to our lenders, and lenders have contacted more than 230,000 unique borrowers with financing options.

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About the U.S. Small Business Administration

The U.S. Small Business Administration makes the American dream of business ownership a reality. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow or expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov.