A previous post here discussed Small Business Administration loans, and one of the problems discussed was that the SBA loan process can take too long for a business that needs quick financing. One way the SBA has tried to combat this is by introducing SBA Express loans. SBA Express loans are similar to regular SBA loans, but applications are guaranteed to receive responses within 36 hours. These loans can be up to $25,000 without collateral.
While SBA Express loans are partially guaranteed by the SBA, they loan process is entirely handled by the SBA Express loan lenders–these lenders can negotiate interest rates and they’re allowed to approve or decline the businesses themselves. SBA Express loan requirements are generally similar to those for regular SBA loans, but those requirements are largely left up to the individual lender. SBA Express loan authorization is given to any lenders that meet certain benchmarks, which means that there are many potential lenders; there isn’t a simple answer to how to qualify for SBA Express loans.
How do Loanability’s programs stack up with SBA Express loans? While 36 hours might seem fast, we routinely beat that–we often have offers just a couple hours after a merchant sends in their application. We also never ask for collateral, whereas SBA Express loans are only uncollateralized if they’re for a fairly low amount. Furthermore, our requirements are simple and clear, while SBA Express loan requirements can vary between lenders and can be as complicated as the lender wants them to be.
The SBA Express program is an attempt to expedite loans for small businesses. While the effort is admirable, at the end of the day approval and funding is still left in the hands of individual lenders, and it’s hard to find good information about general guidelines and specific requirements for the program. At Loanability, we make sure every application receives a prompt response (faster than the 36 hours permitted for SBA Express loans) and we keep requirements simple. The result is that our approval process is quick and easy, and our merchants receive their funds as quickly as possible.