Salem Offers Business Loan, Technical Assistance Program
SALEM, MA — Salem is providing another option for new and existing businesses that are having trouble securing funding during the coronavirus health crisis.
The Salem Loan Fund was launched to help businesses that cannot get a loan from a traditional bank or credit union lender. The loans can range from $5,000 to $100,000 and will have a fixed interest rate, 1 percent closing fee and a term of up to five years.
The loans are designed to help businesses access capital and technical assistance.
The city said the program is the result of a joint effort between the city, Mill Cities Community Investments, Essex County Community Foundation, the Salem Partnership and the Commonwealth of Massachusetts through Massachusetts Growth Capital Corporation in collaboration with technical assistance providers and local financial institutions.
"Small businesses in our community play a critical role in building an economically strong and vibrant community for all," said Stratton Lloyd, Executive Vice President and COO of Essex County Community Foundation. "This loan fund is part of a larger small business ecosystem vision, providing technical assistance, training, capital and networks, that entrepreneurs need to grow and thrive. ECCF is so proud to be a part of this incredible collaborative effort."
Business owners that are interested in the Salem Loan Fund can learn more about here.
To qualify for the loan, the business owner must be at least 18 years old, the business must be located or will be located in Salem, the business must be one that will benefit the community, the business owner must have 20 percent to invest in the project and must be willing and capable of paying the loan back by the end of its term.
"The Salem business community is resilient and has been navigating the economic upheaval caused by the COVID-19 pandemic," Salem Mayor Kim Driscoll said. "This program is another way the city, its partners, and local and regional financial institutions can support Salem businesses during the pandemic and beyond.
"The technical assistance piece is an integral part of the program, a unique offering that is not often associated with a loan program. Not only will businesses be able to seek the financial resources they need, but they will receive invaluable advice and support as they navigate the program and position their business for success."
The program will also offer technical assistance to businesses when it comes to their loan application, financial planning and forecasting.
"Salem has a robust and diverse small business community with a rich history," Gregg Davis, Interim CEO of Mill Cities Community Investments, said. "Mill Cities Community Investments is honored to be welcomed into that community and we are excited to bring our experience administering similarly structured loan funds in the Merrimack Valley to support the strong work already happening in Salem."
The city said the Salem Loan Fund is made possible through financial commitments from lead bank Eastern Bank, East Boston Savings Bank, Berkshire Bank, St. Jean’s Credit Union, NorthShore Bank, Mass Growth Capital Corporation, and Boston Private.
The Essex County Community Foundation will provide a 10 percent loan loss reserve to the fund and will fund the operational costs of the local community development financial institution, Mill Cities Community Investments, who will oversee the program.
"Public-private partnerships are particularly impactful in helping to foster greater economic growth in our Gateway Cities, and we are proud to partner with the City of Salem, the many technical assistance providers, and other lenders in supporting small businesses in Salem," said Bob Rivers, CEO and Chair of the Board of Eastern Bank, the Fund’s lead bank.
This article originally appeared on the Salem Patch
