Top Banks for SBA Loans for Retailers

Last annual update: Aug 28, 2022

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If you’ve been to the mall lately or one of the retail strip centers dotting the nation’s landscape, you’ve noticed that foot traffic continues to pick up. The pandemic’s peak is behind us, and people are happy to be once again moving about their community and spending money at their local retailers.

While SBA lending for brick and mortar retailers was tight during the pandemic, it is much more promising now. While people will always shop online to some degree, many prefer to physically be in a retail environment when buying clothes, accessories, home furnishings, and many other goods.

Many major retailers in America started with a single location and expanded as their first location prospered and their customer base grew. In many cases, SBA loans made that possible.

An SBA loan for a retailer can be used to buy inventory, purchase furnishings and equipment such as shelving and cash registers, expand, pay down debt, or even purchase a competitor’s retail location.

 

Benefits of being a retailer store owner

The biggest benefit of being a retail store owner is owning your own business. Most store owners began their career in retail working for a large retailer and decided to set up their own store to increase their income and control their own destiny.

In addition, retail store owners provide jobs for many people, including students or individuals seeking a new career path after being downsized or retiring from a previous career.

 

How to obtain financing to open, expand, or buy a retail location

If you’re looking for financing as a retailer, consider applying for an SBA loan. The various loan programs offered by the Small Business Administration can help provide the financing you need to set up shop.

The SBA is a government agency that doesn’t lend you the money directly. Instead, it guarantees a significant portion of your loan. That lowers the risk profile for SBA’s lending partners, which include conventional banks and financial institutions, so they’re more willing to approve loan requests.

You also must put significantly less cash or equity down to qualify with an SBA loan. And, with an SBA loan, no covenants or collateral is required.

The most common SBA retail loans include the SBA 7(a) and Express loans.

 

SBA 7(a) loan for opening or buying a retail location

The 7(a) is the preferred SBA loan for retailers. You can use the funds made available through this program to purchase inventory, expand your location, open a new location, or even purchase a competitor’s store.

If you own an existing retail store and want to buy out a partner, you can utilize the funds from an SBA 7(a) loan for that purpose.

The maximum SBA loan for a retailer is $5 million. These term loans are generally repaid with monthly payments that include interest.

The payment stays the same for fixed-rate loans since the interest rate is locked in. However, for variable rate loans, it’s up to the lender to request a different payment amount if the interest rate changes.

 

SBA Express Loans for retailers

SBA Express Loans are a part of the agency’s 7(a) loan program. Up to $500,000 can be borrowed under an Express loan. The approval times are typically much faster for these loans.

If approved, the funds can be utilized for inventory, furniture, supplies, working capital, and real estate. Express loans over $25,000 have a collateral requirement. The SBA usually responds to Express loan applications within 36 hours.

The lenders ultimately make all eligibility and credit decisions. The market prime rate plus 4.5-6% interest is applied with repayment terms of up to 10 years.

 

How to apply for an SBA retail loan

Access our network of SBA lenders that includes leading nationwide banks, credit unions, and other financial institutions. Our lending partners are experienced in handling applications for retailers, so they will diligently pursue your opportunity.

There are countless SBA approved lenders that are ready to offer you a retail SBA loan. These are just some of the top lenders:

RankBank# LoansAvg LoanAvg RateTerm (Mos)
1Wells Fargo452$147,11310.0%129
2TD Bank365$108,73710.0%121
3The Huntington National Bank358$186,7587.3%131
4U.S. Bank266$198,7047.9%102
5JPMorgan Chase Bank209$227,4428.6%116
6M&T207$140,4798.8%108
7First Home Bank149$261,1178.1%121
8Newtek Small Business Finance118$653,3538.3%166
9Bank of Hope111$430,6507.4%134
10Celtic Bank105$1,008,2787.7%203
11Independence Bank94$141,2236.5%120
12Commonwealth Business Bank93$943,8716.9%212
13Five Star Bank67$238,0978.0%125
14Hanmi Bank62$707,3637.1%180
15Pacific City Bank62$1,176,3876.9%236
16Live Oak60$1,503,9177.3%136
17Eastern Bank55$79,3169.8%72
18Byline Bank52$1,169,8067.9%186
19Columbia State Bank52$201,1407.7%121
20Citizens Bank50$814,3517.5%202

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Top retailing businesses obtaining SBA loans:

RankIndustry# LoansAvg LoanAvg RateAvg Term(Mos)
1Gasoline Stations with Convenience Stores569$1,251,2247.1%247
2Beer, Wine, and Liquor Stores547$640,1267.5%155
3Electronic Shopping and Mail-Order Houses484$304,7118.9%121
4Pharmacies and Drug Stores330$646,8447.5%125
5Supermarkets (except Convenience) Stores291$536,0427.5%144
6Convenience Stores286$370,3417.8%163
7All Other Misc Retailers (except Tobacco Stores)238$243,5517.8%121
8Used Car Dealers217$322,3578.3%159
9Sporting Goods Stores187$256,1327.5%120
10All Other Specialty Food Stores167$274,5087.5%113
11Automotive Parts and Accessories Stores164$330,9227.5%136
12Women's Clothing Stores145$161,5228.5%117
13Other Direct Selling Establishments138$338,4307.7%119
14Other Building Material Dealers135$455,7987.6%130
15Cosmetics, Beauty Supplies, and Perfume Stores135$304,8568.3%118
16Other Clothing Stores116$211,7608.0%124
17Hardware Stores113$550,0247.2%142
18Pet and Pet Supplies Stores113$436,3127.8%125
19Furniture Stores111$449,2127.9%128
20Baked Goods Stores102$381,0547.6%121
21Gift, Novelty, and Souvenir Stores100$267,9908.0%122
22Jewelry Stores94$351,1728.5%117
23Vending Machine Operators78$370,2038.1%114
24Florists75$127,8018.1%120
25Tire Dealers74$547,2207.4%158
26Meat Markets68$393,3757.8%136
27Electronics Stores68$319,6568.4%117
28Floor Covering Stores67$295,7577.4%124
29All Other Home Furnishings Stores66$271,6558.0%127
30Shoe Stores64$305,4987.8%125
31Used Merchandise Stores63$201,3277.6%129
32Nursery and Garden Centers62$355,8477.1%132
33All Other Health and Personal Care Stores61$348,7088.2%120
34Food (Health) Supplement Stores57$207,9918.3%110
35All Other General Mdse Stores52$272,0818.2%127
36Tobacco Stores51$184,7658.3%108
37Hobby, Toy, and Game Stores50$160,0728.3%111
38Window Treatment Stores45$237,4607.8%122
39Clothing Accessories Stores44$91,0648.5%105
40Family Clothing Stores43$285,2197.2%129