The USDA Business & Industry (B&I) Guaranteed Loan Program is designed to improve the economic health of rural communities. Similar to SBA loans, the USDA doesn't lend directly but guarantees loans made by eligible local lenders, reducing their risk and encouraging investment in rural businesses.
This program aims to create jobs and stimulate rural economies by providing businesses located in eligible areas with access to affordable capital for growth and expansion. The guarantee allows lenders to offer more favorable terms than they might otherwise provide.
Eligibility is broader than many SBA programs but has a key geographic requirement:
💡 Khojie Insight: The "rural area" definition is quite broad. Many suburban areas qualify! Let us help you check your eligibility.
The B&I program is highly flexible. Funds can be used for various purposes that benefit your rural business, including:
Ineligible uses typically include agricultural production (though processing and marketing are often eligible), owner-occupied housing, golf courses, and speculative activities.
USDA B&I loans offer attractive, long-term financing:
Similar to SBA loans, the process involves working with an approved lender and requires thorough documentation:
⏳ Timeline: Be prepared for a potentially lengthy process (60-120+ days) due to government agency involvement. Starting with a complete package is crucial.
Not necessarily. While strong credit and business financials improve approval chances, the USDA guarantee encourages lenders to work with a wider range of borrowers compared to conventional loans. Focus on a solid business plan and demonstrating repayment ability.
Generally, no. Lenders typically prefer businesses with at least two years of operational history. Startups might explore other SBA programs or alternative financing options.
Yes, collateral is almost always required. Expect to pledge sufficient business assets, real estate, or equipment to secure the loan. The specific collateral requirements will be determined by the lender.
The process can be lengthy due to government involvement. Expect anywhere from 60 to 120 days, or potentially longer, depending on the complexity of your application and the lender's workload.
Eligible areas generally include towns, cities, or unincorporated areas with populations of up to 50,000 inhabitants. You can verify specific addresses using the USDA's eligibility mapping tool available on their website.
Unlock significant capital with favorable terms to expand your operations, create jobs, and strengthen your rural community. Let Khojie guide you through the USDA B&I loan process.
