About this programme
The SBA Surety Bond Guarantee Program is run by the U.S. Small Business Administration's Office of Surety Guarantees. It does not lend money or write bonds itself — it guarantees bid, performance, and payment surety bonds that are issued to small businesses by SBA-authorized surety companies, so a contract bidder can obtain bonding it might not qualify for on the open commercial surety market.
Surety bonds are a standard prerequisite on most government and many private construction and service contracts: a bid bond backs a contractor's bid, a performance bond guarantees the contractor will finish the job, a payment bond guarantees suppliers and subcontractors get paid, and ancillary bonds cover related obligations such as maintenance. The SBA's guarantee sits behind the surety company, sharing the risk on the bond so the surety is willing to issue it to a small business that lacks the balance-sheet history a bond underwriter would otherwise require.
The program covers contract bonds, not commercial bonds (license and permit bonds, fidelity bonds, and similar are outside its scope). It is aimed at small businesses that are otherwise creditworthy but cannot get adequate surety credit through regular commercial channels because of limited track record, working capital, or bonding capacity.
How it works
A small business does not apply to the SBA directly for a bond. It contacts an SBA-authorized surety bond agency (an insurance agency licensed to place SBA-guaranteed bonds) in its state.
The surety agent works with the business to prepare the bond application and, if needed, obtains approval from the SBA's surety company partners underwriting the bond.
Once approved, the SBA guarantees the bond issued by the surety company, sharing the risk with that surety.
The business receives the guaranteed bond and can use it to bid on and perform the contract.
For performance and payment bond guarantees, the small business pays SBA a fee of 0.6% of the contract price. Bid bond guarantees carry no SBA fee. If a bond is cancelled or never issued, the fee is refunded.
Who can apply
The applicant business must qualify as a small business under SBA's size standards for its industry.
The contract being bonded must fall within the program's dollar limits: up to $9 million on non-federal contracts and up to $14 million on federal contracts.
The business must still meet the surety company's own underwriting criteria — credit history, bonding capacity, and character/experience evaluation — since the SBA guarantee supplements, rather than replaces, that underwriting.
How to apply
- Identify a contract that requires a bid, performance, payment, or ancillary bond.
- Find an SBA-authorized surety bond agency in your state using SBA's surety bond agency directory.
- Contact that agency directly to start the bond application; the agency prepares the submission and works with an SBA surety partner for underwriting approval.
- If approved, the surety company issues the bond with the SBA guarantee attached, and SBA's fee (where applicable) is collected on the bonded contract.
- For general programme questions before contacting an agency, SBA's Office of Surety Guarantees can be reached at suretybonds@sba.gov.
Frequently asked
Does the SBA issue the surety bond directly?
No. The SBA does not issue bonds itself. It guarantees bonds issued by its authorized surety company partners, sharing the risk so those sureties are willing to bond small businesses that might not otherwise qualify.
What size contracts does the guarantee cover?
The program applies to contracts up to $9 million on non-federal work and up to $14 million on federal contracts, per SBA's published limits.
What types of bonds are covered?
Bid bonds, performance bonds, payment bonds, and ancillary bonds tied to a contract (such as maintenance obligations). Commercial bonds like license, permit, or fidelity bonds are not covered.
Is there a fee for the SBA guarantee?
Yes, for performance and payment bond guarantees the business pays SBA 0.6% of the contract price. Bid bond guarantees carry no SBA fee, and if a bond is cancelled or never issued, the fee already paid is refunded.
How do I apply — is there an online SBA application?
There is no direct online application to the SBA. A business applies through an SBA-authorized surety bond agency in its state, which prepares the bond submission and coordinates the SBA guarantee with its surety company partner.
Does meeting SBA size standards guarantee I will get bonded?
No. Qualifying as a small business and having a contract within the program's dollar limits are necessary but not sufficient — the surety company issuing the bond still evaluates the business's credit, capacity, and character before underwriting it.
Reviewed 2026-08-16. Programmes change — confirm current eligibility, amounts and deadlines on the official page before you apply. CapEasy is a private consultancy and is not affiliated with any government authority.