Glossary · The loan itself
Working Capital Loan
In short
This is a portion of your SBA loan specifically allocated to cover the day-to-day operating expenses of the business. It helps bridge the gap between sales and cash collection.
What it means in a deal
Many SBA 7(a) acquisition loans include a working capital component, which can be essential for a smooth transition and post-acquisition growth. This isn't just for start-ups; even established businesses need cash to cover payroll, inventory, and other operating costs before revenue flows in. Ensure your 'Uses of Funds' includes a sufficient amount for working capital to avoid cash flow issues in the first few months.
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 Working Capital Loan
- Can an SBA 7(a) loan finance working capital?
- Are there specific limits on the amount of working capital that can be included in a 7(a) Working Capital Pilot Program loan?
- What kind of everyday expenses can working capital cover?
- What does 'working capital' mean for an SBA 7(a) loan?
- What is the typical repayment term for working capital only?
- What is working capital, and can a 7(a) loan cover it?
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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