Glossary · The loan itself
Eligible industry
In short
The SBA restricts 7(a) loans to businesses operating in specific industries and prohibits funding for certain types of ventures. This determines if the business you want to buy can even qualify for an SBA loan.
What it means in a deal
Before you get too far into a deal, confirm the target business's NAICS code aligns with SBA eligibility rules. Industries like financial businesses, gambling, pyramid schemes, and businesses deriving more than one-third of gross revenue from passive activities are typically ineligible. Don't waste time on an ineligible business.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Eligible industry
- How is my prior management experience evaluated if it's in a different industry?
- Does my business's industry affect its eligibility for an SBA 7(a) loan?
- Is prior experience in my specific industry required for an SBA 7(a) loan?
- Will acquiring a business in a restricted industry (e.g., gambling, passive investing) kill approval?
- Does my business's industry type affect its eligibility for an SBA 7(a) loan?
- How does my business's industry affect its eligibility for an SBA 7(a) loan?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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