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Small Business Administration

 
 

What Is the Small Business Administration (SBA)?

The Small Business Administration (SBA) is a U.S. government agency designed to bolster and promote the economy by assisting the country’s small businesses. Established in 1953, the SBA’s primary function is to counsel individuals who want to start and grow their own businesses. It provides a series of tools on its website to assist new and existing small business owners.1 The agency is headed by an administrator and deputy administrator and also has a chief counsel for advocacy and inspector general—all of whom are confirmed by the Senate.2 The SBA has at least one office in every state, the District of Columbia, and various American territories.3

Takeaways

  • The Small Business Administration, established in 1953, is a government agency designed to bolster and promote the economy by providing assistance to small businesses.
  • The SBA is headed by an administrator and a deputy administrator who are confirmed by the Senate.
  • The agency offers various resources to small businesses, including access to capital, entrepreneurial development, government contracting, and advocacy services.
  • The SBA’s loan guarantee program is one of its most visible elements.

Understanding the SBA

The SBA offers substantial educational information with a specific focus on assisting small businesses to develop and grow. As noted above, the agency has numerous tools for businesses that can be accessed on its website, including a small business planner and additional training programs.

According to its website, the SBA provides the following services to small businesses:45

  • Access to capital: The agency offers a variety of financial resources for small businesses, including microlending, or small loans that are issued to those who wouldn't otherwise qualify for financing. Loans are issued by partner banks, credit unions, and other financial institutions.
  • Entrepreneurial development: This is driven by counseling services and low-cost training provided by the SBA and is available to both new and existing business owners in more than 1,800 locations across the United States. There's also a mentor program that connects new business owners with retired and/or existing entrepreneurs.
  • Contracting: The SBA reserves 23% in government contracting dollars for small businesses with the help of other federal departments and agencies. The agency guarantees 5% of these contracting dollars for women and another 3% for business owners who are disabled and veterans.
  • Advocacy: The agency acts as an advocate by reviewing legislation and protecting the interests of small business owners across the country. The agency also advocates for business owners at the state and federal government levels.