SBA loan basics
Short answer
The SBA combines the size of "affiliated" businesses to ensure that only truly small businesses benefit from the program and prevent larger entities from getting loans.
The SBA's affiliation rules are designed to prevent businesses from dividing operations to appear "small" on paper. If entities share common ownership, management, or have contractual relationships that grant control, the SBA combines their revenues or employee counts. This collective size is then compared against the industry-specific size standards to determine eligibility.
A borrower owns a 60% stake in Business A and a 51% stake in Business B. Even if both businesses are separate legal entities, their revenues (or employee counts) would be added together to see if the combined operation exceeds the SBA's small business size standard.
13 CFR Part 121 - Small Business Size Regulations
SOP 50 10 - Lender and Development Company Loan Programs
Affiliation and Lending Criteria for SBA Business Loan Programs - Final Rule
SBA Table of Size Standards
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.
More on eligibility & size
Terms in this answer
Pre-qualify your SBA 7(a) deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to fund a deal like yours and flag anything that trips up approval.
Free · No documents · Usually same-day