How SBA manufacturing loans drive equipment investment and business growth

New federal policy is backing a resurgence in American manufacturing. Policies focused on reshoring, infrastructure investment and supply chain resilience are creating strong conditions for reinvestment. At the heart of this shift is a broader goal: rebuilding local economies, supporting small business owners and creating quality jobs. Expanded Small Business Administration, or SBA, loan programs are making this vision possible.

For many industrial businesses, especially in small towns and rural areas, the opportunity to grow hinges on access to capital. SBA manufacturing loans fill this gap with loan programs that provide flexible, affordable financing for expanding operations, investing in equipment and building or purchasing facilities. These changes to loan eligibility criteria, underwriting standards, and procedures can help businesses scale to grow domestic production when traditional financing isn't within reach.

US manufacturing growth requires capital

Industrial growth requires significant upfront investment. Whether expanding a production line, building a new facility or hiring skilled workers, the costs can be steep. Traditional loans often don't fit the needs of smaller companies, particularly those operating in emerging or underserved markets. SBA manufacturing loans offer an alternative that's both accessible and aligned with long-term business needs.

Two key SBA programs First Citizens offers serve different but complementary purposes:

• SBA 7(a) loans: Used for working capital, inventory, equipment and facility purchases
• SBA 504 loans: Designed for acquiring real estate, building facilities and purchasing major equipment

These SBA-backed loans are designed with small companies in mind. Unlike traditional financing—which often requires high collateral and strict underwriting—SBA loans provide more flexible terms, lower down payments and longer repayment windows. This enables businesses to invest in growth without straining cash flow. By reducing financial barriers, SBA loans for manufacturers allow businesses to act on opportunity and stay competitive in a fast-evolving market.

"504 loans allow business owners to invest in long-term assets and create a foundation for sustainable growth," says Shiloh Hall, Director of SBA Wholesale Lending at First Citizens. "This structure is especially powerful for manufacturers looking to establish lasting operations."

"The 7(a) program supports growth scenarios that conventional financing can't reach—partner buyouts, startups or new product lines," adds Alan Black, SBA Retail Sales Director at First Citizens. "It fills a critical gap in access to capital for small businesses. Where traditional lenders may hesitate, 7(a) provides a path forward."

SBA 7(a) loans: Fueling operational growth

The 7(a) program supports businesses that need flexible capital for navigating daily operations and short-term strategic initiatives. Manufacturers can use 7(a) funds to meet payroll during ramp-ups, respond to demand surges or cover upfront costs for large contracts. It's also a key option for businesses launching new product lines or expanding into new customer segments. With the ability to fund these dynamic needs, the 7(a) program offers a financial backbone that adapts to changing conditions.

Common uses include:

• Expanding production capacity
• Purchasing inventory
• Securing working capital
• Hiring and training employees

Examples of equipment purchase types include:

• CNC machines and automated manufacturing systems
• Industrial robotics and automation equipment
• Quality control and testing instrumentation
• Production line conveyors and material handling
• Manufacturing software and ERP systems

"Rates and fees can be higher, but the ability to secure funding where collateral may be limited is a major advantage," Black says. "Many businesses couldn't grow without it. The flexibility of this program makes it a vital tool for operational expansion."

SBA 504 loans: Investing in long-term stability

Manufacturers looking to buy or expand facilities can benefit from the 504 loan. With as little as 10% down, these loans offer fixed-rate financing over 25 years.

"Owning your facility stabilizes costs and supports long-term planning," says Hall. "It creates predictability in overhead and protects against rising rents. That stability can be the difference between managing growth and struggling to scale."

504 loans are particularly valuable for capital-intensive upgrades. Businesses often use them to purchase or build production plants, expand warehouse capacity or install automated equipment. These investments can improve efficiency, increase output and strengthen supply chain resilience. The long-term structure of the loan aligns with these large-scale commitments, helping businesses build durable infrastructure.

Manufacturers can also use 504 loans for multiple projects as they grow. New refinancing options allow businesses to unlock capital from existing fixed assets. This added flexibility allows businesses to reinvest in equipment, training or additional space.

Program updates expand access and impact

Recent program enhancements such as increased loan limits, expanded eligibility and faster processing reflect a broader effort to make SBA financing more accessible and impactful. For small and midsize manufacturers, these changes lower barriers to capital and open the door to larger, more strategic investments.

Changes include:

• The Made in America Manufacturing Finance Act: Introduced in May 2025, it doubled SBA loan caps for qualifying manufacturers from $5 million to $10 million on both 7(a) and 504 programs. For 7(a) loans to manufacturers (NAICS Sectors 31-33) of $950,000 or less, the upfront fee will be 0% on all existing programs. For 504 loans to manufacturers (NAICS Sectors 31-33), including loans made under the 504 refinancing options, the upfront guaranty fee and annual service fee is 0%. These new fee structures are effective from October 1, 2025, through September 30, 2026.
• Expanded debt refinancing options: New SBA rules eliminate caps and broaden eligibility, allowing manufacturers to refinance existing debt—even without expansion.
• Faster processing for 7(a) loans: SBA's updated standard operating procedures 50 10 8, effective June 1, 2025, include streamlined systems and clearer underwriting guidance to accelerate 7(a) loan approvals, and loans under $350,000 now receive expedited processing if the applicant meets credit score thresholds.
• Broader eligibility criteria: Inflation-adjusted size standards now allow businesses with net worth up to $20 million and after‑tax income up to $6.5 million to qualify for 504 and 7(a) programs.

Many of these updates give manufacturers more flexibility to plan ahead, pursue larger-scale upgrades and better manage capital.

"SBA loans give owners more room to move," Hall says. "They're not being forced to choose between growth and liquidity. They can protect cash flow and still make a big move, and that's especially important in smaller markets."

Financing growth that builds communities

SBA manufacturing loans are designed to help individual businesses invest with confidence in facility upgrades, stronger infrastructure and workforce development. By improving access to capital for small and midsize producers, these programs also support the local economies that rely on them. This is especially meaningful for businesses located outside major markets, especially family-owned or community-based firms.

When a small manufacturer expands operations or automates production, the benefits can ripple outward. Communities have an opportunity to add stable jobs, school districts may see stronger tax bases and local suppliers can find new customers. SBA-backed financing ensures these gains aren't limited to large corporations or coastal hubs, putting tools in the hands of business owners working to grow where they live.

"When a manufacturer adds capacity or upgrades a facility, that investment stays in the community," says Hall. "It leads to durable jobs, a stronger tax base and new opportunity for suppliers. The borrower grows their business and their community at the same time."

Flexible funding to move your business forward

If you're planning to expand, purchase equipment or invest in your facility, SBA manufacturing loans can offer the flexible financing you need. These programs are built to support long-term growth with competitive terms and lower down payments. For many businesses, they're a practical way to strengthen operations and build lasting value.

Key takeaways

• SBA 7(a) and 504 loans offer accessible financing options tailored to help small manufacturers expand operations, invest in equipment and grow operations.
• The 7(a) loan supports short-term and operational needs like payroll, inventory and product line expansion, especially where traditional financing falls short.
• The 504 loan provides long-term, fixed-rate financing for purchasing or building facilities and major equipment, helping manufacturers stabilize costs and scale confidently.
• By improving capital access for small and midsize manufacturers, SBA loans can play a vital role in supporting local economies, creating durable jobs and encouraging reinvestment in communities.