Business & Industry Loan Guarantees Program

Federal Agency: U.S. Department of Agriculture

Description: The Business & Industry Loan Guarantees Program bolsters the availability of private credit by guaranteeing loans for rural businesses.

Eligible applicants: Lenders with the legal authority, sufficient experience and financial strength to operate a successful lending program. This includes:

  • Federal or state-chartered banks
  • Savings and loans
  • Farm credit banks
  • Credit unions

What kind of businesses qualify for loan guarantees?

  • For-profit business
  • Non-profit entities
  • Cooperatives
  • Federally recognized Tribes
  • Public bodies
  • Individuals

Eligible activities: Eligible uses include but are not limited to:

  • Business conversion, enlargement, repair, modernization, or development
  • Purchase and development of land, easements, rights-of-way, buildings, or facilities
  • Purchase of equipment, leasehold improvements, machinery, supplies, or inventory
  • Debt refinancing when refinancing improves cash flow and creates or saves jobs
  • Business and industrial acquisitions when the loan will create or save jobs

Ineligible uses for guaranteed loan funds include but are not limited to:

  • Lines of credit
  • Owner-occupied housing
  • Golf courses
  • Racetracks or gambling facilities
  • Churches, church-controlled organizations or charitable organizations
  • Fraternal organizations
  • Agricultural production, with certain exceptions
  • Distribution or payment to a beneficiary of the borrower or an individual or entity that will retain an ownership interest in the borrower

Award ceiling (MAX):

  • 80% for loans up to $5 million
  • 70% for loans between $5-10 million
  • 60% for loans exceeding $10 million (up to $25 million)

What are the interest rates?

  • Interest rates are negotiated between the lender and borrower, subject to USDA review.
  • Rates may be fixed or variable.
    • Variable interest rates may not be adjusted more often than quarterly.

Award floor (MIN): N/A

Funding Availability: $1 billion*

*The CARES Act includes an additional $1 billion for this program.

Application cycle: Applications are accepted on a rolling basis.

Special considerations:

  • Individual borrowers must be citizens of the United States or reside in the U.S. after being legally admitted for permanent residence.
  • Private-entity borrowers must demonstrate that loan funds will remain in the U.S. and the facility being financed will primarily create new or save existing jobs for rural U.S. residents.
  • Loan guarantees must assist businesses located in a city or town with a population of fewer than 50,000 people.
    • The borrower’s headquarters may be based within a larger city as long as the project is located in an eligible rural area.
  • The lender may be located anywhere in the United States.

More information:

Who can tell me more?

Contact your USDA State or Area Office for guidance related to your specific needs.

To apply: