> Marketplace disclaimer: Loanable is a commercial funding marketplace, not a lender and not an SBA microloan intermediary. Microloans are made by SBA-approved nonprofit intermediaries, which set their own terms. Program figures on this page come from sba.gov as of October 2026 and can change. Nothing here is a quote, an offer, or Loanable pricing.
By the Loanable Editorial Team · Marketplace editorial · Updated October 2026
An SBA microloan is a small business loan of up to $50,000. It is backed by SBA program funds but made by a local nonprofit lender. Microloans are built for startups and very small businesses that need a modest amount of money and some coaching along with it. This guide covers how the program works, what you can use the money for, what intermediaries look for, rates and terms, how to apply, and what to do if a microloan isn't the right fit. For the full range of SBA programs, start with our SBA loans page.
What is an SBA microloan?
The SBA doesn't lend microloan money to you directly. Instead, it gives funds to "intermediary" lenders. These are nonprofit, community-based groups with lending experience. They also offer management and technical help. The intermediary reviews your application, makes the credit decision, and sets your terms.
Per the SBA's microloan page, the program serves small businesses and certain not-for-profit childcare centers that want to start up or expand.
What makes microloans different:
- Small amounts. The cap is $50,000, and the SBA says the average microloan is about $13,000.
- Local lenders. You work with an intermediary in or near your area, not a big bank.
- Support built in. Many intermediaries pair the loan with training or business coaching. Some require it.
- Startup friendly. Intermediaries often work with newer businesses that banks turn away.
How much can you borrow, and for how long?
The program numbers are simple, and they come straight from sba.gov:
- Maximum loan: $50,000.
- Average loan: about $13,000.
- Maximum term: seven years.
Your actual term depends on the amount, what you'll use it for, the intermediary's rules, and your needs. A $10,000 loan for supplies will usually have a shorter term than a $45,000 loan for machinery.
If you need more than $50,000, a microloan won't cover it. The SBA 7(a) program goes up to $5 million. See SBA 7(a) vs 504 to compare the larger programs.
What you can use a microloan for, and what you can't
The SBA lists these allowed uses:
- Working capital
- Inventory
- Supplies
- Furniture
- Fixtures
- Machinery
- Equipment
The SBA also says what you can't do. Microloan proceeds can't be used to pay existing debts or to buy real estate.
That rule matters. If your goal is to refinance a credit card balance or a merchant cash advance, a microloan is the wrong tool. If you want to buy a building, look at the SBA 504 loan instead.
SBA microloan requirements
The SBA sets a basic eligibility floor. Per sba.gov, your business must:
- Not be an ineligible type of business
- Be an operating business
- Operate for profit
- Be located in the U.S.
- Be small under SBA size standards
Beyond that floor, each intermediary sets its own credit rules. General SBA eligibility is covered in our SBA loan requirements guide, so here we'll focus on what microlenders tend to ask for.
Credit history
Intermediaries look at your personal credit, but many are more flexible than banks. They often want to understand the story behind a low score. A medical bill or a past job loss may weigh less than a pattern of missed payments. There's no single program-wide minimum score.
Collateral and a personal guarantee
Many intermediaries ask for some collateral, such as the equipment you're buying or other business assets. Most also ask the owner to sign a personal guarantee. Ask each lender what it requires before you apply.
A business plan
Expect to share a plan. For a startup, it often covers what you sell, who buys it, your costs, and how the loan will be repaid. For an existing business, recent bank statements and financials matter more.
Training or technical assistance
Some intermediaries require you to complete classes or coaching before or during the loan. Treat this as a benefit. Free help with cash flow, pricing, and bookkeeping can pay off long after the loan is gone. Free counseling is also available through Small Business Development Centers and other SBA local assistance partners.
Documents to gather
- Government-issued ID for each owner
- Business formation documents and EIN
- A business plan or a short summary of the business
- Recent business and personal bank statements
- Tax returns, if you have them
- A list of what you'll buy, with quotes where possible
- Any existing debts, so the lender can see your full picture
SBA microloan interest rates
The SBA says microloan interest rates vary by intermediary and are generally between 8% and 13%. That's the published program range on sba.gov as of October 2026. Your rate depends on the lender, your credit, and the loan.
Ask about more than the rate. Some intermediaries charge fees for closing or for the training they provide. Ask for the total cost of the loan in writing, and compare it across lenders.
Here is a simple illustrative example, with round made-up numbers. Two lenders offer the same rate. One has a closing fee and the other doesn't. The one without the fee costs less, even though the rate is the same. Always compare total cost.
How to apply: finding an intermediary
You apply with an intermediary, not with the SBA. Here's how to get started:
- Find microlenders near you. The SBA keeps a list of microlenders by state.
- Try Lender Match. The SBA's Lender Match tool can connect you with lenders interested in your request.
- Call two or three. Ask about their loan sizes, rates, fees, collateral rules, and training needs.
- Prepare your file. Gather the documents above and tighten your plan.
- Apply and follow up. Answer questions quickly. Missing documents are the most common cause of delays.
Timing varies by lender. Microloans usually take longer than online funding because a person reviews your plan, and training may be part of the process. If you need money within days, plan for a different option.
Microloan vs other small-ticket funding
A microloan is one of several ways to raise less than $50,000. Here's how the main options compare.
- SBA microloan: Up to $50,000, term up to seven years, published rate range of 8% to 13%. Slower, needs a plan, and can't pay existing debt or buy real estate. Good for startups and owners who want coaching.
- SBA 7(a) small loan: Part of the 7(a) program, which goes up to $5 million. More paperwork and stricter credit than a microloan, but can be used for more purposes. See SBA loans.
- Business line of credit: Draw what you need, repay, and draw again. Fits ongoing or uneven costs. See line of credit.
- Working capital loan: A lump sum for day-to-day costs, often with faster decisions than SBA options. See working capital.
- Short-term business loan: Fast funding with shorter terms and higher cost. See short-term business loans.
- Merchant cash advance: An advance against future sales, repaid from daily or weekly debits. Fast and flexible on credit, but usually the most expensive. See merchant cash advance.
When a microloan isn't the right fit
A microloan can be a great deal. It isn't always the best match. Look elsewhere if:
- You need the money fast. Intermediary review and training can take weeks.
- You need more than $50,000. Look at the SBA 7(a) program or a term loan.
- You want to pay off debt. Microloan proceeds can't refinance existing debt.
- You want to buy property. Real estate is not an allowed use.
- There's no intermediary near you. Coverage varies by state and region.
In those cases, a marketplace can help you compare other options in one place.
How Loanable's marketplace helps
Loanable is a marketplace, not a lender or an SBA intermediary. We don't make microloans. With one application, you can be matched with options from 150+ funding partners across SBA loan options, term loans, lines of credit, working capital, and merchant cash advances. Partners set their own criteria, rates, and terms. We can't promise approval, but we can help you see real offers side by side.
Frequently asked questions
What is the maximum SBA microloan amount?
The SBA caps microloans at $50,000. The SBA says the average microloan is about $13,000.
How long can an SBA microloan last?
The maximum repayment term is seven years, per sba.gov. Your actual term depends on the amount, how you'll use the money, and the intermediary's rules.
What is the interest rate on an SBA microloan?
The SBA says rates vary by intermediary and are generally between 8% and 13%. Ask each lender for its rate, fees, and total cost in writing.
Can a startup get an SBA microloan?
Yes. The program is meant to help small businesses start up and expand. Startups should expect to share a business plan and may need to complete training.
Can I use a microloan to pay off debt or buy real estate?
No. The SBA says microloan proceeds can't be used to pay existing debts or to purchase real estate.
Does Loanable offer SBA microloans?
No. Loanable is a marketplace, not a lender or SBA intermediary. You apply for a microloan with an SBA-approved intermediary. Loanable can match you with other funding options from its partners.
Find the right small-dollar funding
If you need under $50,000 and have time to work with a local lender, an SBA microloan is worth a call. If you need money faster, need more, or need to refinance, apply once to compare offers from Loanable's funding partners.