SBA 7(a) Q&A
Short answer
Yes, new inventory purchased with your verifiable cash can count towards your equity injection, provided it is an eligible project cost.
SBA rules allow for certain non-cash assets to be included in the equity injection if they are directly related to the business acquisition and purchased with the buyer's unencumbered funds. New, clearly identifiable inventory that is part of the business's opening balance sheet and paid for by the buyer's cash would qualify, assuming proper documentation of purchase and value.
A buyer is acquiring a new retail store, requiring a $100,000 equity injection. They purchase $15,000 worth of initial inventory with their personal cash before closing. This $15,000 can be counted as part of their equity injection, with invoices and proof of payment as documentation.
Insider move
Lenders verify that the inventory is truly new, purchased with the buyer's own funds (not borrowed), and essential to the business's operation. They require clear documentation of the purchase price and proof of payment to prevent inflated valuations or ineligible funds being used.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
SBA Form 1919 - Borrower Information Form
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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