The SBA Preferred Lender Program (PLP) is a designation by the U.S. Small Business Administration (SBA) that grants select financial institutions the authority to approve and process SBA-guaranteed loans without requiring prior SBA approval, significantly expediting the lending process.
Program Overview
The PLP allows approved lenders to make final credit decisions on SBA loans in-house, reducing processing time and paperwork for borrowers. This streamlined approach enables faster funding, with some borrowers receiving approval in as little as 24 hours. Lenders must demonstrate expertise, a strong track record in SBA lending, and meet strict performance and volume criteria to qualify for PLP status.
Lender Authority and Benefits
PLP lenders can process, close, service, and liquidate SBA-guaranteed loans with reduced SBA oversight. This autonomy benefits small businesses by accelerating access to capital for purposes such as working capital, equipment purchases, real estate, and business acquisitions. The program enhances reliability and reduces documentation burdens compared to non-PLP lenders.
Eligibility and Maintenance
To become a PLP lender, institutions must be supervised by a federal or state regulatory authority and meet SBA requirements for loan processing, servicing, and risk management. PLP status is valid for two years and requires recertification to maintain designation, ensuring ongoing compliance and performance.