SBA loan basics
Short answer
Yes, an SBA 7(a) loan can be used to cover the costs associated with hiring new employees and their initial training, as these fall under eligible working capital expenses.
Working capital, a common use of 7(a) loan funds, includes expenses related to business operations. This encompasses salaries, wages, and training costs for new hires, which are essential for business growth or expansion.
A manufacturing business obtains a $200,000 SBA 7(a) loan. They allocate $50,000 of that to hiring five new production line workers, including their first three months of salaries and a two-week specialized training program.
Insider move
Lenders will scrutinize the business's projected cash flow to ensure it can support the new payroll and training expenses, verifying that these costs are reasonable and contribute to the business's long-term viability.
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
SBA 7(a) Loans Overview
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.
More on what it can be used for
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