SBA Guarantees: A Sweet Opportunity



What do SBA lending and maple syrup harvesting have in common? Both can be challenging to get just right but the sugary rewards are worth the effort. Implementing these six key strategies into your SBA lending initiatives will help your credit union savor all the sweet benefits.

In the frigid northeastern United States and in Canada, maple syrup harvest season is right around the corner. Between February and April each year, thousands of small producers in Quebec, Vermont and New York install taps on their trees and begin collecting their sweet bounty.

Maple syrup production is a time-consuming, delicate process that demands high levels of expertise and patience. If boiled too long during production, the syrup will crystallize. If undercooked, the result is a watery, flavorless solution that may ferment and spoil.

Much like maple syrup harvesting, SBA lending can be a challenging enterprise. It requires experience, planning and continuous oversight to minimize the risks of developing off-flavors or even losing your entire harvest. But with some planning and patience, the rewards can be just as rich and satisfying.

Why Consider SBA Guarantees?

A growing number of credit unions are discovering the benefits of the U.S. Small Business Administration’s (SBA) guarantee programs. Over the past five years, total credit union SBA loan balances have grown by 153 percent to nearly $1.6 billion (Fig. 1).

The SBA offers a variety of programs that can be an attractive and core part of your credit union’s member business lending (MBL) portfolio. These programs include the flagship 7(a) Loan Program (which includes the popular SBA Express for loans under $350,000).

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