Economic Disadvantage Criteria (SBA) refers to a set of parameters defined by U.S. Small Business Administration (SBA) that identifies and categorizes certain individuals or businesses as economically disadvantaged. This designation is part of SBA’s mandate to support small businesses and aimed at leveling the playing field for those that may face unique challenges in participating in the mainstream economy due to their financial circumstances.
The criteria cover factors such as net worth, assets, income, and the fair market value of all assets. Specifically, individuals are considered economically disadvantaged if their net worth (excluding their primary residence and the equity in the business) is less than $750,000. Businesses, on the other hand, are categorized as economically disadvantaged if they meet specific thresholds in terms of size and revenue, which vary depending on the industry. SBA’s Economic Disadvantage Criteria are used in various SBA programs, including 8(a) Business Development program, which helps eligible small disadvantaged businesses compete in the marketplace.
