New SSBCI funding for small businesses – everything you need to know
You’ve no doubt heard of – and maybe taken advantage of – the Paycheck Protection Program (PPP). You might have also gotten an Economic Injury Disaster Loan (EIDL). But there’s a new program that provides grants and funding opportunities to small businesses that you may not have heard about yet. And it’s big.
State Small Business Credit Initiative
The State Small Business Credit Initiative (SSBCI) was first established in 2010, reauthorized and expanded under the American Rescue Plan in 2021, and is now providing a second round of nearly $10 billion to states, the District of Columbia, U.S. territories, and tribal governments.
The purpose of the SSBCI is to promote entrepreneurship and increase access to capital, particularly in underserved communities. Each state government has submitted a plan to the U.S Treasury outlining how they will use their allocated funds to support small businesses. They will provide funding through programs that provide venture capital, loan guarantees, loan participation, collateral support, and capital access.
Who is eligible?
While previous rounds of SSBCI focused on Socially and Economically Disadvantaged Individual (SEDI) businesses, this new round will have a broader reach. Each state will determine how their allocated funds will be used, but the program encourages them to “support industries especially important to the U.S. economy – including small businesses that promote American manufacturing, strengthen critical supply chains, and invest in clean energy and renewables to secure our nation’s energy independence,” according to the U.S. Department of the Treasury press release.
Specific programs will vary by state. For example, Maryland will provide:
- $103 million in loan funding for small businesses, owner/operator-occupied development projects, and nonprofits
- $45 million for loan and equity funding for small businesses that cannot obtain adequate financing with reasonable terms
- $50 million for equity funding for early-stage tech and life sciences businesses, and economically underserved founders and communities.
How can I find out what SSBCI programs are available to me?
Start by googling ‘SSBCI’ + your state. This should give you a list of available programs in your state. Watch the dates, though, because some businesses will be eligible for new programs that either weren’t available previously or had stricter requirements.
Determine which organization(s) are administering the program in your state and reach out to them to determine what you are eligible for, and what you need to apply. You’ll probably need bank statements, financial records, tax returns, and so on. If you qualify, you can apply for funds from more than one program.
There’s also an SSBCI Resource Center on the Council of Development Finance Agencies’ website. This provides a comprehensive overview of the program as well as guidelines for businesses. You can also subscribe to the CDFA’s SSBCI Update newsletter to get updates on the program.
Is the money available now?
This phase of the SSBCI program will roll out over the next year. Five states received funds at the beginning of June 2022, and the remaining states will receive theirs over the next 12 months.
Getting funding is an essential step in growing your business. Make sure you also take steps to protect your growing business with the right insurance from Hiscox. Get a quote and you could be covered today.