SBA to sunset FICO SBSS for Small Loans: What does this mean for your small business?
Written byGerri Detweiler & Tiffany Verbeck
Summary
- The SBA has notified lenders of its intent to sunset the requirement that lenders prescreen certain SBA loan applications using the FICO® Small Business Scoring Service℠ Score (SBSS Score) effective March 1, 2026.
- Currently, lenders are required to prescreen 7(a) Small Loans using the FICO SBSS Score.
- In June 2025, the SBA raised the minimum FICO SBSS Score requirement from 155 to 165 while also lowering the maximum amount for these loans from $500,000 to $350,000.
- Lenders may use their own internal credit scoring models and policies to determine creditworthiness for these loans.
The SBA has notified lenders that, as of March 1, 2026, it intends to no longer require lenders to prescreen loan applications for 7(a) Small Loans using the FICO SBSS Score. Instead, the SBA permits lenders to use the credit policies and procedures they use for their other similarly sized non-SBA guaranteed commercial loans.
Learn what this change may mean for your small business.
What’s changing with FICO SBSS
SBA guidelines currently state: “All 7(a) Small Loan applications will begin with a screening for a FICO® Small Business Scoring ServiceSM Score (SBSS Score).” The SBA has notified lenders it will no longer require the use of that score as of March 1, 2026.
In June 2025, the SBA raised the required minimum score for the Small Loan program prescreening to 165. The minimum required score was previously raised from 140 to 155 in October 2020. A lower score does not automatically disqualify the application, but triggers a more detailed review.
How FICO SBSS works
The FICO SBSS Score ranges from 0 to 300, with a higher score typically indicating lower risk to lenders. This scoring model can evaluate data from the following sources:
- Consumer credit
- Business credit
- Financial data
- Application data
For the 7(a) Small Loan program, the FICO SBSS Score has been an integral first step in the approval process. According to the National Association of Government Guaranteed Lenders (NAGGL) the FICO SBSS Score “has been used as the sole scoring model for determining creditworthiness for 7(a) Small Loans.”
The SBSS Score is also used by traditional lenders like banks for other non-SBA commercial loans.
What does this change mean for SBA loan borrowers?
Borrowers likely won’t notice a difference in the SBA loan application process in the immediate future.
The SBA reveals the main reason why when it states that lenders may continue to use “their existing scoring models.”
In other words, if they are already using FICO SBSS for these loans — that’s not likely to change anytime soon.
“The safe thing for a lender to do is to stick with SBSS,” says Levi King, Nav CEO, Co-Founder, and Executive Chairman. Banks are highly regulated, he points out, and are unlikely to take the additional risk associated with an abrupt change in underwriting standards.
Banks often adopt new scoring models slowly, over time, preferring to stick with the models that have been tested over time.
As NAGGL pointed out in the comment letter, “the [SBSS model] has been validated and tested based on SBA loan performance, and the Agency has indicated its strong confidence in it as a tool for determining creditworthiness for 7(a) small loans.”
The bottom line: FICO SBSS changes
Small business owners with strong personal and business credit scores often have the widest range of options when it comes to small business financing. Whether a lender uses a FICO SBSS Score or another model, strong business credit may help a business owner shop for financing with more confidence.
Nav is one of the few places that gives business owners the ability to to check a FICO SBSS Score on their business. It also provides unique access to both business and personal credit reports in one dashboard.