**GAO-08-226T**                      Published: Nov 01, 2007. Publicly Released: Nov 01, 2007.                  

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## Highlights

The Small Business Administration's (SBA) 7(a) program, initially established in 1953, provides loan guarantees to small businesses that cannot obtain credit in the conventional lending market. In fiscal year 2006, the program assisted more than 80,000 businesses with loan guarantees of nearly $14 billion. This testimony, based on a 2007 report, discusses (1) the 7(a) program's purpose and the performance measures SBA uses to assess the program's results; (2) evidence of any market constraints that may affect small businesses' access to credit in the conventional lending market; (3) the segments of the small business lending market that were served by 7(a) loans and the segments that were served by conventional loans; and (4) 7(a) program's credit subsidy costs and the factors that may cause uncertainty about these costs.

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## Topics

Business Regulation and Consumer Protection

Cost analysisGovernment guaranteed loansInterest ratesLending institutionsLoan interest ratesPerformance measuresProgram evaluationProgram managementRisk assessmentSmall businessSmall business assistanceSmall business loansStrategic planningSubsidiesProgram costsProgram goals or objectivesProgram implementation