To encourage entrepreneurship in the United States, the Federal Government has created numerous agencies that facilitate the acquisition of business loans for small businesses and start-up companies. Throughout the nation there is a plethora of government agencies that allocate resources for the sole purpose of extending government business loans to those in need.
Similar to a student loan, a government loan is an investment of sorts. Not only does the government agency make a long term profit off the loan, but they are also investing human capital and the ability for that company to create a product and spark an industry. Without entrepreneurship the country’s economy would cease to sustain itself.
That being said, the structure and legal system of America was established to encourage all forms of entrepreneurship. The presence of government loans is merely one example of this.
As a result of the numerous government agencies that offer government loans, there is a wide variety of loan types. Each loan is designed specifically for a particular type of business and individual. The various programs and loan types are available to all small business owners in the United States:
7(a) Small Business Loan: The 7(a) government small business loan is the most common government loan awarded to small businesses. All 7(a) loans are provided by lenders who are participants of the SBA program–a government-run program part of the Small Business Act, which expands the availability of lenders for small companies. To be eligible, all applicants must meet SBA size standards, be for-profit, and be able to demonstrate repayment.
Business and Industrial Loans: The purpose of these government business loans is to improve, finance, and develop the economic and environmental climate in rural areas.
Microloan Program: The purpose of this program is to provide very small loans (short loan periods and small amounts of funding) to growing businesses.
Short Term Lending Programs: These government small business loans are available to small businesses that need help with transportation-related contracts.
These are just a few examples of government loans. To access or apply for these loans, contact a corresponding government program to inquire more about the various loans offered. All information associated with these agencies can be found online.