Government Shutdown and SBA Loans: What Small Businesses Need to Know

The U.S. Small Business Administration (SBA) plays a crucial role in helping entrepreneurs access affordable capital. However, during a government shutdown, the SBA’s work slows dramatically — sometimes stopping altogether. Here’s what you should know about how a government shutdown affects the SBA pipeline.

Key SBA Impacts During a Government Shutdown

SBA Function	What Happens	What It Means for You
7(a) and 504 Loan Approvals	New approvals pause; SBA cannot issue new loans. Even delegated-authority lenders are blocked once funding lapses.	Entrepreneurs waiting for financing hit a wall, deals stall, and growth plans freeze.
Loan Disbursement (already assigned SBA numbers)	Loans that were fully approved before the shutdown can still fund.	Some closings continue, but anyone mid-approval gets stuck in limbo.
Microloan Program	Continues operating since intermediaries already have funds.	Funds remain for some borrowers.
Disaster Loans	Still processed, but with staffing delays.	Communities recovering from floods, fires, or storms face slower aid.
Servicing & Modifications	Requests for waivers, refinancing, or other SBA approvals stall..	Businesses needing flexibility on existing loans may face delays.
Contracting & Certification (8(a), WOSB, HUBZone, etc.)	Most new certifications and program support stop.	Firms pursuing government contracts can’t get new approvals.
Training & Counseling (SCORE, SBDCs, WBCs)	Many continue because of alternative funding.	Business owners can still access advice, but no new capital is flowing.
Internal SBA Staffing	Large portions of the workforce are furloughed.	Even “allowed” functions slow down, communication lags, and backlogs build.
Post-Shutdown Backlog	Once funding returns, SBA must dig out from a mountain of paused work.	Delays persist for weeks or months, making the “restart” frustrating and uncertain.

Why This Matters for Entrepreneurs and Lenders

Funding freezes impact growth plans. If your expansion depends on a 7(a) or 504 loan, a shutdown can derail your timeline.
Deals in flight face uncertainty. Even when you’ve started paperwork, you may lose momentum — or the terms may change once approvals resume.
Post-shutdown backlogs linger. The SBA must catch up after each disruption, often causing long delays well into the new fiscal year.
Borrowers need to stay proactive. Early submission, strong documentation, and backup capital options can be critical to weather uncertainty.

How Hum Capital Can Help When the SBA Pauses

At Hum Capital, we connect growing businesses directly with a diverse network of private lenders and investors — without relying on federal appropriations cycles. Our Intelligent Marketplace matches companies with funding options ranging from revenue-based financing to venture debt and other sources of growth capital, helping you: