Public-Private Partnership Will Support Organizations in Historically Underserved Communities
Governor Ned Lamont announced the launch of the Connecticut Small Business Boost Fund, a public-private partnership that provides low-interest loans to small businesses and nonprofits in Connecticut. Businesses can now apply for loans ranging from $5,000 to $500,000.
The program is aimed at helping small businesses and nonprofits, particularly those in low-income and historically underserved communities, with access to flexible working capital. The loans have a fixed, 4.5% interest rate and are available to eligible small businesses and nonprofits with operations in Connecticut that have 100 or fewer full-time employees and annual revenues of less than $8 million.
The state is making a foundational investment of $75 million into this public-private partnership, with the other $75 million coming from private banks, including CMSC Corporate Investor M&T Bank. The goal is for the fund to become self-sustaining as more private funds are invested.
Small businesses and nonprofits can apply online at CTSmallBusinessBoostFund.org, and if they qualify, they will be matched with a lender. Once matched, the participating lender will assist the business owner throughout the application process. This lending model has previously found success in programs based in California, New York, and Washington state.
The fund works with and through local community development financial institutions (CDFIs) and lenders that have decades of experience serving historically under-resourced and underbanked communities. The following CDFIs are participating in the program, including CMSC Corporate Investor Capital for Change:
- Ascendus
- Capital for Change
- HEDCO
- NDC Community Impact Loan Fund
- Pursuit
- Southeastern CT Enterprise Region (SeCTer)
It is administered by the National Development Council (NDC) with funding arranged by Calvert Impact Capital. In addition to funding from the Connecticut Department of Economic and Community Development (DECD), initial funding has been provided by Citizens Bank, M&T Bank, and First Republic Bank.
“We consider this program to be a one-stop shop for small-business owners,” DECD Commissioner David Lehman said. “What separates the Connecticut Small Business Boost Fund from other loan programs is that it offers support and guidance services, in addition to the financial assistance, that helps put recipients on the path to success.”
“At M&T we recognize that small businesses are the backbone of our local economies, especially in underserved and diverse communities,” Michael Weinstock, M&T Bank regional president for Hartford, said. “That’s why we’re proud to be joining the Connecticut Small Business Boost Fund to support small businesses and nonprofits that too often lack access to affordable, flexible credit. Our focus as a community bank has always been on providing resources that financially empower our customers. This partnership is another important action we are taking to further that mission.”
