Other Contract
SBA Surety Bond Guarantee
The SBA Surety Bond Guarantee program helps small contractors get bid, performance, and payment bonds by having the SBA guarantee part of the surety's loss.
- Required by
- Not required; it is a federal program sureties use to support small business bonds
- Bond amount
- Set by whoever requires the bond. We confirm it.
What this bond guarantees
The bond itself is an ordinary bid, performance, payment, or ancillary bond. The SBA reimburses the surety 90 percent of a loss on contracts of $100,000 or less and for disadvantaged, HUBZone, veteran-owned, and service-disabled veteran-owned businesses, and 80 percent on other contracts. That backing lets sureties bond contractors they might otherwise decline.
Who needs it
- Small and emerging contractors
- Contractors without the financial history for standard surety credit
- Disadvantaged, HUBZone, and veteran-owned contractors
What the underwriter looks at
- SBA small business size standards
- Contract size: up to $9 million non-federal or $14 million federal
- Contractor's experience and character
- Credit and financial statements
Requirements vary by state and by who asks for the bond. Send us the request you received and we will confirm exactly what it calls for.
Common questions
Does the SBA charge a fee?
There is no fee for bid bond guarantees. For performance and payment bonds the SBA charges 0.6 percent of the contract price, refunded if the bond is never issued or is cancelled.
What contracts qualify?
Contracts up to $9 million for non-federal work and up to $14 million for federal work, according to SBA. Commercial (non-contract) bonds are not covered.