Expanded program awarded through federal State Small Business Credit Initiative ‘to provide shorter term loans and address inequitable capital access’
Gov. Kathy Hochul on Monday announced the expanded $55.5 million Small Business Revolving Loan Fund 2 is available to provide shorter-term microloans and regular loans “to address inequitable capital access by bridging the financing gaps facing new companies, under-banked communities and small businesses.”
Her team said, “Part of New York’s broader State Small Business Credit Initiative efforts led by Empire State Development, this expanded program will leverage financial loan capital to drive economic activity by expanding access to short-term loan capital for small, micro and socially and economically disadvantaged individual-owned businesses that have faced historical barriers to obtaining credit or adequate loan terms. This builds on the success of the first round of the Small Business Revolving Loan Fund that launched in 2010 with $25 million in funding that achieved nearly $280 million in loans issued to small businesses.”
Hochul said, “Ninety-eight percent of New York’s businesses have fewer than 100 employees and are a key driver of our economic growth. The Small Business Revolving Loan Fund 2 will bolster these small businesses, especially our minority and women entrepreneurs, and help build the economy of the future.”
Empire State Development President, CEO and Commissioner Hope Knight said, “When our small businesses succeed, our communities succeed. The Small Business Revolving Loan Fund 2 will support our small businesses by providing capital to help businesses thrive, create jobs and grow New York’s economy, now and for the future."
Hochul’s team explained small businesses may apply for lending through a participating Community Development Financial Institution (CDFI). Program lenders use the capital from the program along with matching capital from other resources to further enhance available funding for small businesses. Typical uses of funds are working capital, acquisition and/or improvement of real property, acquisition of machinery and equipment, and in some cases refinancing of debt obligations.
Microloans (loans between $500 and $25,000); and regular loans (typically as large as $250,000 or more depending upon the lender) are available with terms based upon each lender’s individual offerings.
Program lenders are the primary point of contact for borrowers, and each have their own loan application process and loan products. Competitive interest rates, terms and fees are determined by the individual program lenders. Lenders are responsible for applications and credit decisions.
Participating lenders for this program are:
•Adirondack Economic Development Corp.: $1,000,000 – service area: Essex, Franklin, Hamilton, Jefferson, Lewis, St. Lawrence, Fulton, Herkimer, Oneida, Oswego, Saratoga, Warren and Washington counties
•BOC Capital Corp.: $2,000,000 – service area: Queens, Kings, Richmond, New York, Bronx, Westchester, Suffolk and Nassau counties
•Harlem Entrepreneurial Fund: $1,500,000 – service area: Queens, Kings, New York and Bronx counties
•NYBDC (dba Pursuit Lending): $3,000,000 – service area: statewide – all counties
•NYBDC Local Development Corp. (dba Pursuit Lending): $3,000,000 – service area: statewide – all counties
•Renaissance Economic Development Corp.: $4,000,000 – service area: Bronx, Kings, New York, Queens, Richmond, Nassau, Suffolk, Dutchess, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester counties
•Syracuse Cooperative Federal Credit Union: $500,000 – service area: Cayuga, Cortland, Madison, Onondaga and Oswego counties
•TruFund Financial Services: $3,000,000 – service area: Queens, Kings, Richmond, New York, Bronx, Westchester, Suffolk, Nassau counties
•Washington Heights and Inwood Development Corp.: $100,000 – service area: Northern Manhattan, which includes Washington Heights, Inwood and Western Bronx in New York and Bronx counties
•Additional lenders are expected to enroll throughout the fall of 2023.
New York State Sen. Sean Ryan said, "Homegrown businesses are essential to the success of New York's economy, so it is important that we maintain a constant focus on creating and funding programs that produce a friendlier climate for those who do business here. Inequitable access to loans can often make it difficult for would-be entrepreneurs to establish and maintain small businesses. By bridging that gap, this fund will remove a major barrier for prospective small business owners, create new jobs, and accelerate economic growth throughout the state."
Assembly member Harry B. Bronson said, “Small businesses are the backbone of our economy. Accessing funding for upgrades, to hire and retain employees, and grow has often been a struggle. The Small Business Revolving Loan Fund is changing this by offering flexible funding to our expanding pool of small entrepreneurs. This will help New York state develop a more equitable, diverse and stable economy where small businesses of all kinds can thrive on their own terms.”
Hochul’s team said, “More than $500 million in federal funding has been allocated to support the resurgence of small businesses across New York state through the State Small Business Credit Initiative (SSBCI), a program through the American Rescue Plan Act. Managed by the U.S. Department of Treasury, SSBCI provides funds to support programs for small businesses, including socially and economically disadvantaged individual (SEDI) owned businesses and very small businesses (VSB), to recover from the economic effects of COVID-19 and allow them opportunity to succeed in the post-pandemic economy. With this funding, Empire State Development has developed a suite of capital access and equity programs to help New York state small businesses grow and succeed.”
Learn more at esd.ny.gov/ssbci.