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Small Business Lending in Washington State Up During Fiscal Year 2014

SBA Continues to Focus on Microloans, Small Loans for Fiscal Year 2015
Release Date: 
Wednesday, December 3, 2014
Release Number: 
15-04
Advisory Date: 
Wednesday, December 3, 2014
Contact: 
Mark Costello, 206-553-7312

SEATTLE  The U.S. Small Business Administration (SBA) 7(a) Loan Program reached another lending record during Fiscal Year (FY) 2014, announced this month by SBA Administrator Maria Contreras-Sweet. Small business lending via the SBA 7(a) program showed an increase in the SBA Seattle District as well, which serves Washington state and northern Idaho.

The 7(a) program is designed to provide small businesses with the most comprehensive type of financial assistance to cover the vast majority of business expenses, such as short and long-term working capital, exports, and refinancing existing debt under certain conditions.

Overall Lending
By the end of the fiscal year (Sept. 30), the SBA Seattle District approved 1,458 7(a) loans for more than $580 million, an increase of nine percent in the number of loans and four percent in dollar amount over fiscal year 2013.

“Our loan numbers reflect the trends we’re anecdotally seeing across the district,” said SBA District Director Nancy Porzio. “This includes an uptick in export finance, more loan funds accessed by historically underserved business owners, and an increase in micro and small loans. I’m glad to see this steady growth in our district as my team continues to focus on these areas through 2015.”

Small Loans and Microloans
Other SBA loans that did well in FY 2014 were those $150,000 and under. Spurred by the fee relief implemented at the beginning of the fiscal year (fees were set to zero), these loans saw an increase in the SBA Seattle District of 22 percent in number of loans (771) and 30 percent in approved dollars (nearly $48 million) over fiscal year 2013 (630 and nearly $37 million respectively). The percentage increase in approved dollars is slightly higher than then national average of 29 percent.

Business Loans by Demographics
Fee relief was also instrumental in helping veteran small business owners through the Veteran Advantage initiative (zero fees on loans $150,000 to $350,000 to veterans.) Fee relief for veterans began January 1, 2014, and by the end of the fiscal year amounted to $610,000. Fee relief for both loans $150,000 and under, and for Veterans Advantage, was extended through fiscal year 2015. During FY 14 in the SBA Seattle District, 89 veteran small business owners received loans, up seven percent from the year before.

Also seeing an escalation in loans were women-owned small businesses with a 12 percent increase in number of loans (257) and 41 percent in approved dollars (nearly $102 million) over fiscal year 2013 (229 and $72 million respectively).

Small businesses reflect the dynamic demographics of the United States. During FY 2014, the number of SBA loans to Native American, Asian American and Pacific Islander, African American and Hispanic business owners increased by 67 percent, four percent, 25 percent and 31 percent, respectively. This averaged to an 11 percent increase in the number of loans and a five percent increase in the approved dollars (372 total loans for more than $232 million).

Lending for Exports and Contracting
As exports continue to play a pivotal role in strengthening the nation’s economy, SBA loans to exporters grew by nearly 6 percent in number of loans and nearly 59 percent in dollar amount over last year, much higher than the national increases of 3.7 percent and 12 percent, respectively.

One of the ways in which SBA helps small businesses is through providing essential bid and performance bonds to small contractors, which allows these small businesses to be more competitive when bidding on contracts, be they with the government or the private sector.

During FY 2014, the SBA Office of Surety Bond Program – which has staff located in Seattle – saw a national increase of four percent in total contract value, from $6.168 billion in FY 2013 to $6.413 billion in FY 2014. Total bond contract amount also grew from $1.262 billion in FY 2013 to $1.358 in FY 2014, an increase of eight percent.

Lending Partners
As the SBA Seattle District Office continues to reach out and help small businesses across Washington state and northern Idaho, lenders play an important role as partners, as it is through them that SBA financial assistance is channeled and managed.

During FY 2014, the SBA Seattle District Office worked with approximately 90 lenders that, collectively, made 1,598 loans for nearly $689 million. This includes all SBA loan program, including the SBA 504 loan program.

For more information about the SBA’s Loan Programs and other financial assistance as well as services, please visit http://go.usa.gov/GQh3. To find a local SBA lender, visit www.sba.gov/wa.

About the U.S. Small Business Administration (SBA) Seattle District Office:
The SBA Seattle District serves Washington state and northern Idaho with office locations in Seattle and Spokane. Today’s SBA stands for more than Small Business Administration; it stands for Smart, Bold and Accessible. SBA staff provides resources and services in three areas referred to as “the three C’s” – Counseling, Capital and Contracting. Visit www.sba.gov/wa for localized information including resource partners, lenders, events and workshops, success stories, news and updates, and other information aimed to help business start, grow and succeed.

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