Mahoning Valley Economic Development Corp. has been selected by the U.S. Small Business Administration to grant loans to small businesses for up to $200,000. This is one of 20 first community lending organizations that are being selected by the SBA.
In Ohio, MVEDC is one out of two agencies that are designated for lending purpose. The other similar agency is the ‘Ohio Community Development Finance Fund’ based in Columbus. MVEDC is an intermediary Lending Pilot Program that is authorized by Congress in Small Business Jobs Act of 2010. This program is going to provide direct loans of $1 million to 20 community organizations and intermediaries in fiscal 2011. The organizations will then be utilizing the funds, in order, to help finance small businesses that belong to the underserved communities.
In Mahoning Valley, 50 to 60 businesses are expected to be directly benefitted by the $1 million award. The program grants agencies to lend out 100% of the amount that a borrower might seek. The SBA guarantees repayment of 75%, 85%, even 90% of the money that SMEs borrow through MVEDC. Loans are extended to small businesses on its own authority by the MVEDC. But the same lending criteria are followed and what is being lent out are taxpayer dollars.
Intermediary Lending Program like that of MVEDC is designed to expand access to capital for small businesses and bring about economic growth and create more number of jobs. This program is going to fund 20 additional community lenders in fiscal 2012. It also has an additional one year of authority in fiscal 2013 but that is subject to appropriation by congress. The resources that MVEDC has been provided is appealing and help qualifying small businesses find capital that they need to initiate a new business, create new jobs and grow.
This article was submitted by Raj Tulshan, Director of Business Development of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to firstname.lastname@example.org