A note on scope first, because it matters: our loan database tracks SBA 7(a) and 504 loans, funded through banks and Certified Development Companies. The SBA Microloan program is a separate system, run through nonprofit intermediary lenders, and it is not part of the FOIA dataset behind this site. Nothing below is drawn from our data; it is the current official program, verified against SBA’s own pages.
What we can offer honestly, from our data: the small end of the 7(a) program, loans under $50,000, the same ceiling as a microloan. Since FY2010, and as of the March 2026 data refresh, 214,425 of the 919,729 7(a) loans in our data, about 23.3%, were funded for less than $50,000. These are bank-originated 7(a) loans, not Microloan Program loans, and they should not be confused with one another. They do show up differently in outcomes: 7(a) loans under $50,000 charge off at 5.9%, well above the 4.0% charge-off rate across all 7(a) loans. See the full breakdown in our study what predicts an SBA loan charge-off.
What an SBA microloan actually is
The Microloan program funds up to $50,000 per loan, with an average loan size the SBA reports at about $13,000, well below the program’s own ceiling. It is aimed at startups and very small working-capital or equipment needs, the segment a bank is often unwilling to underwrite at all.
Funds can go toward working capital, inventory, supplies, furniture and fixtures, and machinery or equipment. They cannot be used to pay off existing debt or to buy real estate. Maximum repayment term is seven years. Interest rates are set by the individual intermediary, not the SBA, and typically run 8% to 13%.
Why it works through intermediaries, not banks
The SBA does not lend microloan funds to a small business directly, and no bank sits in the middle either. Instead, SBA lends to approved nonprofit, community-based intermediary organizations, which relend to small businesses and provide required management and technical assistance alongside the loan. An intermediary cannot borrow more than $750,000 from SBA in its first year in the program, and its total obligation to SBA is capped at $5 million in later years, subject to state-level statutory limits. Intermediaries must also contribute 15% of any SBA funds they draw from non-federal sources.
That structure is why microloans do not appear in bank-level SBA lending data, including ours: the lender of record is a nonprofit intermediary, not a 7(a) or 504 lender.
How to find one
There is no single national microloan lender to shop; you apply directly to a participating intermediary that serves your area. The SBA maintains a directory of active intermediaries by state. If you have outgrown the $50,000 ceiling, or your use of funds includes real estate or debt refinancing that microloans exclude, a standard 7(a) loan is the next step up; compare lenders with a track record in your state and industry through Lender Match.
Before you rely on this
Microloan terms, intermediary directories, and lending limits are set by SBA rule and can change. Confirm current details, including which intermediaries are active near you, directly with SBA or a listed intermediary.