What is an SBLC? Access to SBA 7(a) Loans Without a Bank in 2025

If you’re a small business owner seeking financing, you may have come across the term “Small Business Lending Company” (SBLC). But what exactly is an SBLC, and why are they so valuable for small business owners? Let’s dive in.

What Is an SBLC?

An SBLC is a unique type of lender certified by the Small Business Administration (SBA) to provide SBA 7(a) loans across all 50 states. Unlike traditional banks or credit unions, SBLCs are non-depository institutions, meaning they don’t accept customer deposits.

What sets SBLCs apart is their rarity. Back in January 1982, the SBA capped the number of SBLC licenses at 14. As a result, a new SBLC can only emerge if an existing license is relinquished. This exclusivity makes SBLCs highly sought-after partners in the small business financing space.

While banks and other deposit-accepting institutions can also offer SBA 7(a) loans, they are not classified as SBLCs. Becoming an SBLC involves a rigorous process, but for lenders dedicated to supporting small businesses, the effort is well worth it.

What It Takes to Become an SBLC

To qualify as an SBLC and offer SBA 7(a) loans, lenders must meet stringent requirements:

• Demonstrate the ability to consistently handle all aspects of small business lending with high quality over the long term.
• Comply with the SBA’s rules for issuing loans.
• Adhere to strict ethical standards set by the SBA.
• Maintain good standing with federal or state examiners.

Why Non-Bank Lenders Are Popular

Small business owners often prefer non-bank lenders like SBLCs for several reasons. These lenders are known for their flexibility, transparency, competitive rates, and faster processing times.

Non-bank lenders also play a critical role in supporting underserved communities. For instance, a 2021 NYU study found that fintech-based non-depository lenders were highly effective in providing Paycheck Protection Program (PPP) loans to Black-owned businesses. Automation in their systems allowed them to:

• Approve and fund more loans in smaller amounts.
• Reach customers in areas without traditional brick-and-mortar branches.
• Operate without the influence of human biases.

The Benefits of SBA 7(a) Loans

The SBA offers several loan programs, including the 7(a) program, the 504 program, and export-focused loan programs. Among these, the 7(a) program is one of the most versatile and accessible for small business owners.

Here’s why SBA 7(a) loans are a popular choice:

• Lower interest rates and flexible terms: These loans are often more affordable than traditional financing options.
• Relaxed credit requirements: Borrowers with lower credit scores or limited credit history still have a chance to qualify.
• Federal backing: Loans are funded by the lender but partially guaranteed by the federal government, reducing risk for the lender.

The 7(a) program provides loan amounts ranging from as little as $1,000 to as much as $5 million. These loans can be used for various purposes, including:

• Purchasing equipment or commercial real estate.
• Renovating or expanding operations.
• Acquiring a business or refinancing certain types of debt.
• Working capital to support day-to-day operations.

Thanks to the federal government’s guarantee of up to 85%, SBA lenders are more willing to support promising business owners who may lack collateral, have lower credit scores, or are just starting out.

Why SBLCs Matter

While SBLCs are rare, their impact on small businesses is significant. By offering SBA-backed loans, these lenders help entrepreneurs secure the financing they need to grow, hire employees, and eventually qualify for larger, traditional loans.

For small business owners, an SBLC can be a vital partner in achieving long-term success and making a positive impact on their communities.

Ready to explore your financing options? Learn how SBLCs can help your business thrive.

FAQs about SBLC

1. What is an SBLC?

An SBLC (Small Business Lending Company) is a non-depository financial institution certified by the SBA to offer 7(a) loans across all 50 states. Unlike banks, SBLCs do not accept customer deposits.

2. How does an SBLC differ from a bank?

SBLCs are non-depository lenders, meaning they don’t accept deposits like traditional banks do. Banks can also offer SBA 7(a) loans but they aren’t classified as SBLCs.

3. Why are SBLCs so rare?

The SBA limits the number of SBLC licenses to just 14 at any given time. This exclusivity means that new SBLCs can only be created when another SBLC gives up its license.

4. What is an SBA 7(a) loan?

The SBA 7(a) loan is one of the most common and flexible loan programs offered by the U.S. Small Business Administration. It is designed to help small business owners secure financing for various needs, such as working capital, equipment, real estate, and expansions.

5. How do SBLCs help small businesses?

SBLCs offer flexible, lower-cost loans to small business owners who may not qualify for traditional financing. They provide SBA 7(a) loans, which are partially backed by the federal government, making them easier for small businesses to obtain.

6. What are the benefits of getting a loan from an SBLC?

Loans from SBLCs are known for their lower interest rates, flexible terms, and relaxed credit requirements. Additionally, the federal government guarantees up to 85% of SBA 7(a) loans, reducing the risk for lenders.

7. What types of loans can an SBA 7(a) be used for?

SBA 7(a) loans can be used for a wide variety of purposes, including purchasing equipment, commercial real estate, expanding a business, refinancing debt, and providing working capital.

8. Who is eligible for an SBA 7(a) loan?

Small business owners who may have lower credit scores, less collateral, or less extensive credit histories may still be eligible for SBA 7(a) loans due to the government’s partial guarantee.

9. Why do small business owners prefer non-bank lenders like SBLCs?

Non-bank lenders are often preferred because of their transparency, flexibility, and faster processing times. They are also more likely to serve underserved communities and small businesses without a traditional banking relationship.

10. How does an SBLC support underserved communities?

SBLCs, especially those that use fintech, have been shown to be effective at reaching underserved communities. They use automated systems to quickly process and approve smaller loan amounts, which benefits small businesses in areas with few or no brick-and-mortar banks.

Final Thoughts

This blog provides valuable insights into the unique role that Small Business Lending Companies (SBLCs) play in small business financing. It highlights the rarity of SBLCs and their critical importance as partners for entrepreneurs who may not qualify for traditional loans. By offering SBA 7(a) loans, these non-depository lenders empower small businesses with flexible, affordable financing options tailored to their needs.

SBLCs bridge the gap for underserved communities, leveraging innovative processes to provide equitable access to funding. They help small businesses not only survive but thrive, enabling growth, job creation, and long-term success.

For small business owners, understanding the benefits of SBLCs and SBA 7(a) loans can open doors to new opportunities and make a significant difference in achieving their business goals.

Whether you’re starting a new venture or looking to expand, exploring financing options through an SBLC could be the key to unlocking your business’s full potential.