# Who qualifies for an SBA microloan?

**Short answer:** Small, for-profit operating businesses in the United States, plus certain nonprofit childcare centers. Startups can apply. Each intermediary sets its own credit standards, since SBA does not review microloans for creditworthiness (sba.gov/loans/microloans; 13 CFR § 120.707(a)).

Canonical page: https://www.sbaexpress.loans/answers/who-qualifies-for-sba-microloan/
Last checked: 2026-11-08

A microloan borrower must meet SBA's core business tests (sba.gov/loans/microloans, read November 8, 2026):

- Be an operating business.
- Operate for profit.
- Be located in the U.S.
- Be small under SBA size requirements.
- Not be an ineligible type of business.

## Startups and childcare centers

SBA says microloans help small businesses and certain not-for-profit childcare centers start up and expand. A borrower can use proceeds to establish a nonprofit childcare business (13 CFR § 120.707(a)).

## Who the program aims to reach

13 CFR § 120.700 says the program assists women, low income individuals, minority entrepreneurs and other small businesses needing small amounts of financing.

## Size test

A microloan applicant must meet the size standard for its primary industry (13 CFR § 121.301(a)). The alternative net worth test in § 121.301(b) applies only to 7(a) and 504 loans.

## Who is barred

An intermediary cannot lend to a business with an Associate who is currently incarcerated. It also cannot lend to a childcare business with an Associate on probation or parole for an offense against children (13 CFR § 120.707(a)).

## Credit

SBA does not review microloans for creditworthiness, so each intermediary decides. Above $20,000, you must show you cannot get credit elsewhere at comparable rates and have good prospects for success (13 CFR § 120.707(b)).

## Sources

- [13 CFR § 120.700](https://www.ecfr.gov/current/title-13/section-120.700)
- [13 CFR § 120.707](https://www.ecfr.gov/current/title-13/section-120.707)
- [13 CFR § 121.301(a)-(b)](https://www.ecfr.gov/current/title-13/section-121.301)
- [sba.gov/loans/microloans (read November 8, 2026)](https://www.sba.gov/loans/microloans/)