In an effort to shift portion of state’s deposit to community banks, Steven Grossman, Massachusetts State Treasurer is taking all steps to boost local lending. The first $50 million in deposits will be made to 10 community banks that include Pentucket Bank in Haverhill and Leader Bank in Arlington. This deposit will help increase lending to small businesses.
Small businesses are the backbone of economy. This funding is going to be one of the vehicles so as to help small businesses grow. Grossman is of the opinion that the state would move deposits from larger pool of state funds held by large banks for the sake of small business.
Scott D. Cote, Pentucket chief executive, suggests this idea for the Small Business Banking Partnership program. Cote says that it makes sense for state to re-circulate the tax money into Massachusetts communities. This is a real plus point as “The state is bringing money back to the state.”
This move has been made at a time when community banks have increased small business lending. But the increase in lending is found not enough to offset reductions by credit card companies and national lenders. The finding is in accordance to a study conducted by the Massachusetts Bankers Association.
The other banks that have been approved for the program are North Middlesex Savings Bank, Chicopee Savings Bank, Bank of Cape Cod, Belmont Savings Bank, Mercantile Bank and Trust Co., Century Bank, Mechanics Cooperative Bank and South Shore Savings Bank.
This article was submitted by Rohit Arora, co-founder of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to