Cost of capital

The FY2023 borrower signed at nearly double the FY2021 rate

Average initial interest rate at approval, and the share of each cohort on variable terms.

A borrower closing in FY2021 at 5.49% and one closing in FY2023 at 10.12% are servicing very different obligations against the same kind of business — roughly $1,300 a month apart on a $500,000 ten-year loan. And 85% of the FY2023 book floats, so nothing was locked in.

10.12%average initial rate, FY2023 originations

5.49%the same figure two years earlier

85.1%of FY2023 loans on variable terms

Source: Analysis of SBA 7(a) FOIA loan-level data (as of 31 March 2026). Cancelled approvals excluded. Charge-off timing measured from approval date to recorded charge-off date. Published by sba-feasibility-study.com.