Overseas Private Investment Corporation (OPIC) is a development finance institution of U.S. Government. Recently, OPIC announced a ‘call for proposals’ for the launch of a new loan guarantee program meant to expand loan availability to small businesses.
The principal goal of the program is to make loans available to small and medium enterprises. OPIC is going to encourage U.S. banks to expand lending to small and mid-sized enterprises having projects in developing countries.
The program is intended to make it easier for American banks to make funds available in emerging markets . It is going to encourage participating banks to allow borrowing of loans for businesses and projects that would not otherwise receive financing.
This program is termed as the ‘U.S. Bank Guarantee Loan Facility’. It is going to select qualified banks based on their performance and fund them properly so that they can underwrite loans to small businesses based on their own credit and risk-rating policies.
The program is going to allow banks to develop their own portfolio of loans and will give them the authority to decide which business receives loans and its structure and amount. This program is designed to be straightforward and cost-effective and will be based on OPIC’s risk sharing and origination process.
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