Who qualifies for a Working Capital CAPLine?
Short answer
A business that generates accounts receivable or holds inventory and meets SBA's core eligibility rules. Notes receivable do not count. Proceeds may only cover short-term working capital needs (SOP 50 10 8.1, Sec. B, Ch. 4, Para. A.1).
A Working CapitalMoney for day-to-day costs such as payroll, rent and inventory. Full definition CAPLine is for a business that generates accounts receivable, holds inventory, or both. Notes receivable do not count (SOP 50 10 8.1, Sec. B, Ch. 4, Para. A.1.a). You must also meet SBA's core eligibility rules in Section A.
What the money can do
- Proceeds may only cover short-term working capital and operating needs (Para. A.1.b).
- Exporters may use the line for Export Transactions, including Domestic-to-Foreign and Foreign-to-Foreign Exports (Para. A.1.b).
- It may refinance only existing short-term revolving debt, and that debt must be terminated after payoff (Appendix 14, Para. B.4).
What it cannot do
- Pay delinquent withholding taxes or similar trust funds.
- Provide floor plan financing.
- Stay in fixed assets. If the line paid for a fixed asset, that portion must move to a term facility. The lender has 90 days from discovering it (Para. A.1.b).
How the line is sized
Without a borrowing base certificate, the lender uses its own policy or SBA's formula. Divide prior-year net sales by 365, then multiply by the number of days to finance in your sales cycle (Para. B.1.c). With a certificate, size follows available collateralProperty a lender can take and sell if a loan is not repaid. and your expected working capital need.
SBA says these lines are generally used by businesses that provide credit to other businesses (sba.gov/sba-lenders, read November 8, 2026).
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