SBA lenders approved 516 7(a) loans to caterers from October 2023 to June 2026, about $231 million from 157 lenders. The median loan was $137,500, below the national $150,300, at a median rate of 10.49%, above the national 10.25%. Nearly half the loans (46.5%) were SBA Express, yet 61 loans topped $1 million and 67 SBA 504 loans had a median of $1,042,000, which points to banquet halls and event venues. Lenders decide on seasonality, how customer deposits are handled, concentration in corporate accounts, and, for venues, the building and its liquor license.
| Measure | Caterers | All industries |
|---|---|---|
| SBA 7(a) loans approved | 516 | 162,355 |
| Median loan | $137,500 | $150,300 |
| Middle half of loans | $50,000 – $412,700 | $50,000 – $500,000 |
| Loans of $1 million or more | 11.8% | 12.9% |
| Median rate at approval | 10.49% | 10.25% |
| Middle half of rates | 9.25% – 11.5% | 9.3% – 11.25% |
| Acquisitions (change of ownership) | 32 (6.2%) | 16,849 (10.4%) |
| Median acquisition loan | $578,700 | $693,000 |
| Lenders that made these loans | 157 | 1,648 |
| SBA 504 loans (real estate, equipment) | 67 | 16,714 |
Approvals FY2024 – FY2026 to date (1 Oct 2023 – 30 Jun 2026), cancelled loans excluded. Source: SBA 7(a) and 504 FOIA loan records, as of June 30, 2026.
- SBA 7(a) loans approved
- 516 (Oct 2023 – Jun 2026)
- Median loan
- $137,500 (national $150,300)
- Median rate at approval
- 10.49% (national 10.25%)
- SBA Express share
- 46.5% of loans
- SBA 504 loans
- 67, median $1,042,000
- Acquisitions
- 32 loans (6.2%), median $578,700
Two kinds of caterer in one set of figures
Caterers (NAICS 722320) took 516 SBA 7(a) loans from FY2024 through June 2026, worth $230,965,500, from 157 lenders. The industry code covers off-premise caterers who cook in a commissary and serve at the client's site, and banquet halls and event venues with their own catering staff. The figures show both.
| Figure | Caterers | What it points to |
|---|---|---|
| Median loan | $137,500 (national $150,300) | Most loans are small |
| Middle half of loans | $50,000 to $412,700 | Vans, kitchen equipment, working capital |
| SBA Express | 46.5% of loans | Nearly half on the lender's own process, up to $500,000 |
| 90th percentile | $1,114,000 | The top tenth is venue-sized |
| Loans of $1 million or more | 61 (11.8%) | A large top end for a small-loan industry |
| SBA 504 | 67 loans, median $1,042,000 | Owners buying event buildings |
| Median rate | 10.49% (middle half 9.25% to 11.5%) | Above the national 10.25% |
| Fixed-rate share | 21.7% | More than a fifth of loans fixed, a high share |
| Start-ups / franchises | 8.9% / 1.7% | Established independents, rarely new |
The median rate above the national figure may reflect the many small loans. SBA's variable-rate cap is the base rate plus 6% from $50,001 to $250,000 and plus 6.5% at $50,000 or less, against plus 3% above $350,000, so a small Express loan leaves the lender room to price higher. See SBA maximum interest rates.
Customer deposits: the question every caterer gets
Catering runs on deposits. A couple pays a share of a wedding a year ahead; a company pays for its holiday party in the summer. That cash arrives before the work, and it belongs to the event, not to the business, until the event happens. On a cash-basis return it can look like income in the year it lands. On a balance sheet it should be a liability: deferred revenue the caterer owes in food, staff and service.
Lenders ask three things. How large is the deposit balance, and how has it moved? Was the deposit cash spent on last year's costs, so that this year's events will be served with no cash behind them? And does the tax return recognize revenue when the event happens or when the money arrives? A caterer whose returns show a strong year because bookings ran ahead may have borrowed from next year. See cash vs accrual financials for lenders.
Bring a schedule of booked events with deposits received and balances due. It answers the deposit question before a lender asks it, and it is the best evidence of next year's revenue.
Seasonality and concentration
Wedding season, graduation season and the holidays can bring most of a year's revenue into a few months, and winter can be thin. SBA requires debt service coverage of at least 1.15x, and 1.0x globally once the owners' personal debts are included, but it is tested on the year; the lender also wants to see the slow months paid for. Monthly P&Ls and bank balances show it. A seasonal line of credit can carry the gap better than a larger term loan. See seasonal lines of credit and SBA CAPLines vs a conventional line.
Corporate and institutional catering smooths the calendar but brings concentration. A caterer that feeds one employer's offices every weekday, or depends on one venue's preferred-vendor list, has a customer the lender will treat as critical. Ask what happens if that account leaves, and have the contract or at least the history to show. Caterers running cafeterias under long contracts may fall under food service contractors instead.
Venues: 504, liquor licenses and the building
The 67 SBA 504 loans, at a median of $1,042,000, and the 61 7(a) loans of $1 million or more are where venues show up: banquet halls, event barns, reception spaces with kitchens. The data do not split them out. 504 finances owner-occupied real estate, typically 50% from a bank, 40% from the CDC and 10% from the borrower. A special-purpose property raises the borrower's share to 15%, and a new business in one to 20%, and some lenders treat a banquet hall as special-purpose. The borrower must occupy at least 51% of an existing building. See 504 vs a conventional commercial mortgage.
A venue lender looks at the building's appraisal and how many other uses it could serve, bookings per year and average event size, the liquor license and whether it transfers on a sale, parking and occupancy limits, and whether the venue depends on a single in-house caterer or allows outside ones. 7(a) financing can also cover a venue with its real estate over up to 25 years; on loans of 15 years or more, prepaying more than 25% in any of the first three years costs 5%, 3% and 1% of the prepaid amount in years one, two and three. See SBA prepayment penalties.
Buying a catering business
Only 32 loans, 6.2% of the industry against 10.4% nationally, financed a change of ownership, at a median of $578,700 and a median rate of 9.5%. The low share makes sense: an off-premise caterer's value often sits in the owner's reputation, chef and client list, which are hard to buy. The purchases that do get financed tend to include a venue or a commissary with a book of recurring accounts.
A buyer injects at least 10% of total project costs; a seller note counts toward half of that only on full standby for the life of the SBA loan. The seller may consult for up to 12 months, or up to 24 months under SOP 50 10 8.1 from 1 October 2026, but cannot remain an owner, officer or employee, so a buyer who needs the seller in the kitchen longer has a problem to solve before closing. Deposits the seller collected for events that fall after closing become the buyer's obligation; the purchase agreement should move that cash to the buyer or credit it against the price. From 1 October 2026 every change of ownership needs financial due diligence and 1.25x debt service coverage on historical results. See working capital at close and financing a restaurant acquisition.
Preparing a caterer's file
SBA's standard list applies: business tax returns for 2–3 years, a P&L and balance sheet with a year-to-date P&L, a debt schedule with copies of notes being refinanced, and personal tax returns and a personal financial statement for each 20%+ owner, all of whom guarantee the loan. An acquisition adds the target's latest full year of figures and the letter of intent.
For a caterer, add monthly revenue for at least two years, the booked-events schedule with deposits, the top accounts and their share of revenue, the commissary or venue lease or deed, health permits, the liquor license if there is one, and a vehicle and equipment list. Caterers that bridged a slow season with a merchant cash advance should list it; SBA will not refinance an active advance. See refinancing cash advances for restaurants.
Transparent builds those into a financing model, lender presentation, blind teaser and underwriting memo in a day, and sends the file to the 278 lenders in its book that write SBA 7(a) and 504. On SBA loans the lender pays Transparent, not the borrower. For neighboring food businesses see full-service restaurants and mobile food services.
Common questions
- Are customer deposits counted as income by lenders?
- A careful lender counts them only once the event happens. Until then it reads deposits for future events as a liability and checks whether the cash is still there to serve them.
- Can I buy a banquet hall with an SBA loan?
- Yes. Caterers took 67 SBA 504 loans in the period at a median of $1,042,000, a size that points to venues. The borrower's share is typically 10%, but 15% or more if the lender treats the hall as special-purpose property.
- Why is SBA Express so common for caterers?
- 46.5% of the industry's loans were Express. Most caterers borrow modest amounts for vans, kitchen equipment and working capital, and Express handles loans up to $500,000 on the lender's own credit process with a 50% guaranty.
- How do lenders handle a caterer's slow season?
- They look at monthly results to see the slow months covered. A seasonal line of credit often fits the gap better than borrowing more on a term loan.
- Why are catering acquisitions rare?
- Only 6.2% of loans financed a change of ownership. Much of a caterer's value sits with the owner and chef, so purchases that finance well usually include a venue or recurring accounts.