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SBA Loan Rates - Current Rates For 2023

SBA Loan Rates 2020
Susan Guillory
Susan GuilloryUpdated June 6, 2023
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When you consider small business loans and other financing options for your company, it’s important to know how much you’ll pay in interest over the term of a loan. A $10,000 loan, for example, will cost you more than $10,000 when you factor in the annual percentage rate (APR) you pay on top of it.Typically, a Small Business Administration (SBA) loan is considered a more affordable form of financing. These loans can provide the working capital you need to grow your business.They do carry interest as well. Several years ago, the interest rates for SBA loans were quite low. As the Federal Reserve has steadily increased the market prime rate, SBA loan rates have climbed.Read on to learn about SBA loans and what rates you might expect to see.

What Are SBA Loans?

Interest rates impact all sorts of financing tools, from mortgages to credit cards, both business and personal. One of those tools is the SBA loan.SBA loans actually cover several different loan programs offered by the Small Business Administration. These loans are guaranteed by the SBA but offered by banks and some online lenders:
  • 7(a) Loan Program
    • Standard 7(a) loan
    • SBA Express
    • SBA Veterans Advantage
    • CAPLines
    • Export Working Capital Program
    • Export Express
  • Disaster Loans
  • Microloan Program
  • CDC/504 Real Estate & Equipment Loans
  • Community Advantage Loans
Each loan targets different purposes, with different funding limits. For example, the 7(a) loan, the most popular SBA loan, provides up to $5 million for renovation, construction, or the purchase of equipment, among other things. The microloan, on the other hand, has a cap of $50,000 and can be used for similar purposes.SBA loan requirements vary depending on the program. To potentially qualify for a 7(a) loan, you must run a for-profit business with fewer than 500 employees, among other criteria. For the Veterans Advantage loan, the business must be run by a veteran or family member of a vet, for a start.If you plan to apply for an SBA loan, make sure to read the requirements and funding limitations before applying to make sure you qualify. SBA loans are notorious for taking a while to process, so the better prepared you are in advance, the more likely you could be to receive the loan.SBA loan rates vary from loan to loan, so keep reading to find out how much you might pay in interest if you take out a loan from the SBA.Recommended: What Is the Typical Interest Rate on a Business Loan?

Factors That Impact SBA Loan Rates

There are a few factors that impact SBA loan rates. First, there’s the business loan prime rate. This is the rate that banks offer their best clients, and it’s tied to the federal funds rate, which fluctuates based on market conditions.From that prime rate, the SBA adds a little extra to the interest rate it charges borrowers. The lenders who offer SBA loans may also add even more to that. This will vary, depending on the loan.Here’s where you come into play: your creditworthiness, the time you’ve been in business, and the collateral you provide (where required), among other factors, will determine your specific interest rate.Someone with excellent credit and high-value collateral may get a lower interest rate on the same loan as someone else who hasn’t been in business long and doesn’t have great credit. If you identify more with the latter scenario, you might decide to work on building your credit and coming up with a stronger piece of collateral before applying for an SBA loan to have a possibly better chance of being approved at a great rate.Recommended: Understanding Different Types of Small Business Loans

Current SBA Loan Rates

SBA 7(a) Loan Rates

The interest rates for the 7 (a) loans were usually between 9.25% and 11.00%, as of May 2023. With 7(a) loans, you can typically choose between a fixed rate loan and a variable rate loan.To explain, with a variable rate loan, you’ll pay a base rate (also called a reference rate) plus whatever rate you qualify for. That base rate may be the prime rate mentioned above, the LIBOR rate, or an optional peg rate. The London Interbank Offered Rate, or LIBOR, is commonly used by world banks for variable-rate loans and credit cards.  Starting in January 2022, the Secured Overnight Financing Rate (SOFR) was established as a broad measure of the cost of borrowing cash overnight collateralized by Treasury securities. (The peg rate is a weighted average of the rates the federal government pays for loans with maturities similar to the average SBA loan.)

SBA Disaster Loan Rates

The SBA offers disaster loans, and for a couple of years, the focus was on providing financial support to businesses hit hard by COVID-19 with the Economic Injury Disaster Loan (EIDL). Those loans are no longer being offered.To qualify for an EIDL loan, you must operate a small business, private non-profit, or agricultural business in the U.S.

Microloan Program

You can borrow up to $50,000 with the Microloan Program. Interest rates are typically between 8% and 13%, with a repayment period of up to six years.Requirements will vary with the lender, and you may be required to provide collateral and/or a personal guarantee. You may also be required to participate in training or planning requirements to help you launch or expand your business.Recommended: What to Know About Microloans

SBA 504 Loan Rates

SBA 504 loans are provided through Certified Development Companies (CDCs), which are licensed by the SBA. 504 loans are actually composed of two separate loans: one from a bank (for 50% or more), and one from a Certified Development Company (CDC) (for up to 40%). The rest comes from collateral you provide. In May 2023, SBA 504 Loan Rates were between 5% and 6%.CDCs are nonprofit organizations that promote economic development through these loans. They are certified and regulated by the SBA and work with the SBA and lenders that offer 504 loans to provide funds to qualified small businesses.To qualify for the 504 program, you must have a tangible net worth of $15 million or less, and an average net income of $5 million or less after federal income taxes for the two years prior to applying.Per SBA rules, rates for 504 loans are based on the current market rate for 5-year and 10-year U.S. Treasury issues. The bank and the CDC may add other fees to that. Your actual rate may vary depending on several factors, including the term of the loan, the project you are financing, and the real estate backing the loan. Recommended: SBA 504 Loans Versus 7 (a): What’s the Difference

SBA Express

If you want an SBA loan faster than normal, the SBA Express program might be worth exploring. It provides up to $350,000 at an average business loan interest rate of 4.5-6.5% above the prime rate. You may be able to receive funds within 36 hours of applying.

SBA Veterans Advantage

Qualifying veterans and their families can get access to both the 7(a) and SBA Express loans through this program and pay no guaranty fee for either. To qualify, the business must be run by a veteran, active-duty military in TAP, reservist, or National Guard member, or a spouse of any of these, or a widowed spouse of a service member or veteran who died during service, or a service-connected disability.Recommended: The Veteran Advantage: Starting a New Business


The CAPLines program is designed to help small businesses keep cash flowing during short-term and cyclical cash crunches. Interest rates follow those of the 7(a) program. Qualifications are also those of the 7(a) program.

Export Working Capital Program

This program provides up to $5 million to be used for short-term working capital for exporters. The interest rates are the same as those of the 7(a) program, and qualifications are the same, with the additional requirement that borrowers must need short-term working capital for direct or indirect exporting.

Export Express

This program, also geared toward exporters, offers up to $500,000 to be used for anything that enhances a business’ export development. Interest rates follow the 7(a) program.

Community Advantage Loans

The Community Advantage Loan program is designed to assist small businesses in underserved markets and provides up to $250,000 in funding. Interest rates are the same as those of the 7(a) program.To qualify, your business must be for-profit and operate in an underserved area. Approval is not based on your balance sheet or collateral available.Recommended: What Are Common Business Loan Terms?

Other Financing Options for Your Small Business

Now that you see the typical small business loan rates for SBA loans, you might want to also explore other financing options. Know that the rates you might qualify for with an SBA loan may be better than any other small business loan rates you will find with traditional lenders, business credit cards, or lines of credit.Still, if you don’t meet the requirements for SBA rates, you might see what else is out there. Or, as suggested before, you might work on building your credit so you may qualify for a low rate in the future.Another option: small business grants. Grants provide funds you can use to launch or grow your company, but unlike with loans, you don’t typically have to pay them back. If you're curious about what type of business loan you might qualify for, Lantern by SoFi can help. With our online loan comparison tool, you can be matched with a loan offer that meets your company’s needs and qualifications.Explore small business financing.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website on credit (

About the Author

Susan Guillory

Susan Guillory

Su Guillory is a freelance business writer and expat coach. She’s written several business books and has been published on sites including Forbes, AllBusiness, and SoFi. She writes about business and personal credit, financial strategies, loans, and credit cards.
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