Alabama agencies have expended $19.5 million of federal funds through lending and investing programs aimed at helping small businesses and entrepreneurs expand their operations, hire new workers and strengthen the economy.
According to the U.S. Department of the Treasury’s first quarterly report of its State Small Business Credit Initiative (SSBCI) program, that’s the ninth largest dollar amount expended of any state and 62 percent of Alabama’s total allocation of $31.3 million in SSBCI financing, which was awarded in August of 2011.
The quarterly report demonstrates accelerated lending to small businesses through June 2013. As of Dec. 31, 2012, Alabama had expended $8.4 million in SSBCI funds to support $18.1 million in private loans and investments.
SSBCI programs fall into five categories: capital access programs, loan participation programs, collateral support programs, loan guarantee programs and venture capital programs.
To qualify for SSBCI financing, small businesses must use the federal funds to leverage private capital. According to the report, the financing has reached small businesses in a diverse number of industries, from retail trade to manufacturing, hospitality and many other types of services.
Through the program, which was created through the Small Business Jobs Act of 2010, the Treasury has awarded almost $1.5 billion to 47 states, the District of Columbia, five territories and municipalities in three states.
The program is expected to help spur up to $15 billion in new private sector lending or investment in small companies nationwide by leveraging $10 in private capital for every dollar of federal support by the program’s end.
Nationwide, the program already supported 4,600 small businesses with loans or investments of $1.9 billion in 2012. The program also helped U.S. small businesses create or save 53,000 jobs and nearly 80 percent of SSBCI loans and investments went to businesses with 10 or fewer employees.
Antrenise Cole, Reporter- Birmingham Business Journal
Antrenise Cole covers banking, finance, small business lending, venture capital, accounting and law for the Birmingham Business Journal.