Small Business Administration - SBA

DEFINITION of 'Small Business Administration - SBA'

The Small Business Administration (SBA) is a U.S. government agency, formulated in 1953, that operates autonomously. This agency was established to bolster and promote the economy in general by providing assistance to small businesses. One of the largest functions of the SBA is the provision of counseling to aid individuals trying to start and grow businesses. On the agency’s website, (SBA.gov), there is a wealth of tools to assist small businesses including a small business planner and additional training programs. Localized SBA offices throughout the United States and associated territories offer in-person, one-on-one counseling services that include business plan writing instruction and assistance with small business loans.

BREAKING DOWN 'Small Business Administration - SBA'

The SBA offers substantial educational information with a specific focus on assisting small business startup and growth. In addition to educational events offered on the SBA’s website, local offices also provide more personalized special events for small business owners.

The History of the SBA

The SBA was established by President Eisenhower through the signing of the Small Business Act in the summer of 1953. In its more than six decades of existence, the SBA has been threatened on numerous occasions. The House of Representatives, controlled by the Republican party in 1996, had the SBA slated to be eliminated. However, the agency survived this threat and went on to receive a record budget in 2000. The SBA faced further threat by President Bush and his administration. Though attempts to cut the agency’s loan program saw significant resistance in Congress, the SBA’s budget was cut repeatedly each year, from 2001 to 2004, when certain SBA expenditures were frozen altogether.

The SBA Loan Program

The loan programs offered by the SBA are among the most visible elements the agency provides. The organization does not offer grants or direct loans, with the exception of disaster relief loans, but instead guarantees against default pieces of business loans extended by banks and other official lenders that meet the agency’s guidelines. The number one function of these loan programs is to make loans with longer repayment periods available to small businesses.

The Future of the SBA

As of 2016, despite numerous attempts to do away with the SBA entirely, many political officials and offices continue to support the agency. President Barack Obama and his administration have continually supported the SBA and remain backers of a substantial budget allotment for the agency. The SBA’s ability to offer loans has also been significantly strengthened by the American Recovery and Reinvestment Act of 2009 and the Small Business Jobs Act of 2010.

RELATED TERMS
  1. Venture Capital

    Money provided by investors to startup firms and small businesses ...
  2. Small Business Investment Company ...

    A privately-owned investment company that is licensed by the ...
  3. Business

    1. An organization or enterprising entity engaged in commercial, ...
  4. Seed Capital

    The initial capital used to start a business. Seed capital often ...
  5. Startup

    A company that is in the first stage of its operations. These ...
  6. Venture Philanthropy

    The application or redirection of principles of traditional venture ...
Related Articles
  1. Fundamental Analysis

    M&A Report: Will These 5 Trends Carry into 2016?

    Find out what was behind the record level of merger and acquisition (M&A) activity in 2015 and whether the trend will continue in 2016.
  2. Budgeting

    Tools for Finding the Right Loan or Grant for Your Small Business

    Learn more about some of the best tools, resources and organizations available to connect small business owners with business funding opportunities.
  3. Stock Analysis

    5 Big Tech M&A Deals in 2015

    Read about five of the largest M&A transactions by total value in 2015, and learn a little about how the companies involved might fit together.
  4. Entrepreneurship

    Follow These Rules When Borrowing Money for Your Business

    Learn the new rules to follow when borrowing money for your business. Understanding the do's and don'ts can make all the difference when it comes to getting a loan.
  5. Entrepreneurship

    Trade Name Vs. Trademark: Know the Difference

    Understand the differences between a trade name and a trademark, the different functions they serve and registration considerations for business owners.
  6. Entrepreneurship

    Need a Loan for Your Startup? Here's How to Prepare a Thorough Loan Package

    Learn how to craft the vital components of a loan package for your startup small business, and how to package it to be as appealing to the lender as possible.
  7. Active Trading Fundamentals

    How Does Fundera Work and Make Money?

    Learn more about Fundera, the online loan broker service agency, and discover what it offers and how it makes money through its service.
  8. Entrepreneurship

    4 Government Grants for Small Business Owners

    Discover common resources available to and used by small business owners and entrepreneurs in funding initiatives through government grants.
  9. Entrepreneurship

    The 4 Best Websites For Small Business Loans (EBAY, PYPL)

    Discover some of the best websites that small business owners utilize to obtain necessary financing at competitive interest rates.
  10. Entrepreneurship

    Can You Handle A Home-Based Business?

    Find out if you have the traits to be a top entrepreneur.
RELATED FAQS
  1. What are some good resources to help entrepreneurs develop a business model?

    Find out what resources are available for developing a small business model; learn what websites contain useful information ... Read Answer >>
  2. How do small firms record installment sales?

    Read up on what an installment sale is, how to account for it and the benefits a small business may receive by using the ... Read Answer >>
  3. I am starting a limited liability company (LLC). I will be the sole member. Can I ...

    In a word, yes. A limited liability company (LLC) is eligible to establish a simplified employee pension (SEP). Keep in mind ... Read Answer >>
  4. What do real estate investors look for in a property?

    Profit from real estate investments by either flipping homes or becoming a landlord. Learn best practices for a successful ... Read Answer >>
  5. What are some of the disadvantages to taking venture capital?

    Learn how financing a business through venture capital can be a viable source of funding for small businesses but know caveats ... Read Answer >>
  6. What's the difference between limited liability partnership and general partnership?

    Learn the differences between general partnerships and limited liability partnerships; each type has unique traits, benefits ... Read Answer >>
Hot Definitions
  1. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  2. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  3. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  4. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  5. Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument ...
  6. Economies Of Scale

    Economies of scale is the cost advantage that arises with increased output of a product. Economies of scale arise because ...
Trading Center