Pentagon and SBA sign agreement on defense companies’ access to capital — The Hill

In the United States, the Pentagon and the U.S. Small Business Administration (SBA) have signed an agreement intended to expand small companies in the defense industrial base’s access to strategic capital. The initiative is expected to help suppliers, manufacturers and innovators secure funding to strengthen domestic supply chains and increase production, The Hill reports.

Cooperation between the Pentagon and the SBA

The agreement advances the work of the Smaller War Plants Commission (SWPC), whose creation was announced in late August. It aligns the work of the Pentagon’s Economic Defense Unit with the SBA’s Office of Investment and Innovation and Office of Capital Access.

The Economic Defense Unit will identify companies that need financing through the Business Operators for National Defense program. Potential participants will be referred to the SBA, which will use its network of lenders to help them obtain funding through administration-backed programs.

More current news is available on the UA.News Telegram channel Telegram.

Support for industrial capacity

The agreement also enables the SBA to support the Economic Defense Unit’s investments in small and medium-sized enterprises that are restoring or expanding industrial capacity needed for national security. The areas mentioned include critical materials, the extraction of strategic and critical metals and minerals, as well as munitions.

Defense Secretary Pete Hegseth said the commission will be able to rapidly direct strategic capital to small businesses that produce ships, munitions, microelectronics, materials, components and technologies for the military. SBA Administrator Kelly Loeffler noted that small manufacturers make up 70% of the U.S. defense industrial base. According to her, the SBA manages a small-business portfolio worth nearly $500 billion.

Historical model of the commission

In August, the SWPC was presented as an analogue of the Smaller War Plants Corporation, created by the U.S. Congress in the 1940s. That structure helped small businesses manufacture military goods during World War II, secured contracts, provided loans and offered technical assistance.