Are you looking for a flexible financing solution to support your business’s growth and operations? The U.S. Small Business Administration (SBA) has introduced the SBA CAPLines program, offering credit lines of up to $5 million to help small businesses manage their short-term and cyclical working capital needs.
What is the SBA CAPLines Program?
The SBA CAPLines program consists of four types of credit lines tailored to address specific business needs:
- Working Capital CAPLine: A revolving line of credit designed to cover short-term operating expenses and working capital needs, excluding delinquent taxes or floor planning expenses.
- Seasonal CAPLine: Provides support during peak seasons by managing inventory and accounts receivable. Repayment is required at the end of each busy season.
- Contract CAPLine: Designed for businesses with contract-based sales, covering overhead and administrative costs associated with fulfilling specific contracts. Repayment is due upon receipt of the contract payment.
- Builders CAPLine: Supports expenses related to construction projects, including labor and materials. Credit repayment is required within 36 months of project completion or upon the sale of the property.
Eligibility and Terms
To qualify for an SBA CAPLine, businesses must meet general SBA loan requirements such as being a for-profit entity operating in the U.S. Additional specific criteria apply to each CAPLine type. For instance, Seasonal CAPLines require businesses to demonstrate at least one year of seasonal activity, while Contract CAPLines need proof of profitability on previous contracts.
Repayment terms for these credit lines vary, with most offering up to 10 years for repayment, and the Builders CAPLine having a maximum term of five years. Interest rates for these lines of credit are competitive, similar to standard SBA 7(a) loans.
Increased Fines and Enforcement
The SBA has implemented increased fines and stricter enforcement measures to ensure responsible borrowing and compliance with loan terms and regulations by small businesses.
Don’t miss this opportunity to equip your business with the financial flexibility it needs to grow and thrive. For more detailed information about the SBA CAPLines program, visit the SBA at sba.gov.
Unlock the potential of your business with the SBA CAPLines program and empower your operations with the funds necessary to drive success!
