SBA 7(a) Q&A
Short answer
Yes, the donor of a gifted equity injection must sign a formal gift letter that specifically states the funds are an irrevocable gift with no expectation of repayment.
The SBA requires a signed gift letter from the donor for all gifted equity injections. This letter must clearly state that the funds are a true gift, not a loan, and that the donor has no claim or expectation of repayment, nor any ownership interest in the business as a result of the gift.
If your friend gifts you $50,000, they would need to sign a letter addressed to the lender and/or the SBA, explicitly confirming the gift's nature. This letter would accompany your loan application documents for verification.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
7(a) Loan Program — Terms, Conditions, and Eligibility
U.S. Small Business Administration · Official SBA source
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-14. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-14 · SBA sources checked through 2026-06-14. 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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