$1 million loan fund the result of government, non-profit, and for-profit entities working together to provide capital, technical assistance to Salem businesses during COVID pandemic and beyond
Salem, Massachusetts – The City of Salem is pleased to share a new opportunity for Salem’s entrepreneurs and business owners to access capital and technical assistance to start or to grow their business. The Salem Loan Fund offers loans to Salem’s existing and start-up businesses that cannot currently access financing from a traditional bank or credit union lender. Loans will range from between $5,000 to $100,000 with a one percent closing fee, feature a fixed interest rate, and have a term of up to five years.
To qualify, businesses must demonstrate the following:
- The business owner(s) is 18 years of age
- The business is located, or will be located, in Salem
- The community would benefit from the business project
- A minimum of 20% to invest in the project
- A willingness and capability to repay the loan
In addition to the loan opportunity, the program offers technical assistance to businesses seeking funding. Qualified community partners can assist business owners with the loan application, and, if a business is not ready to take on a loan, they can help with financial planning and forecasting. The technical assistance providers are able to connect businesses to networks that can offer guidance and help the business advance to a point where accessing funding in the Salem Loan Fund makes sense.
“The Salem business community is resilient and has been navigating the economic upheaval caused by the COVID-19 pandemic. This program is another way the City, its partners, and local and regional financial institutions can support Salem businesses during the pandemic and beyond,” said Mayor Driscoll. “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.”
This program is the result of a joint effort between the City of Salem, 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.
Gregg Davis, Interim CEO of Mill Cities Community Investments stated, “Salem has a robust and diverse small business community with a rich history. 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.”
“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.”
The technical assistance providers include the Enterprise Center at Salem State University, North Shore Community Development Corporation, North Shore Latino Business Association, Creative Collective, Massachusetts Small Business Development Center, the North Shore Alliance, and E for All Lynn.
“We’re excited to be part of this collaborative effort as a technical assistance partner,” said Laura Swanson, Executive Director of the Enterprise Center. “This program will help strengthen and encourage small business creation and growth in the City of Salem.”
Felicia Pearce, Chief Program Officer at the North Shore Community Development Coalition, stated, “North Shore Community Development Coalition invests in neighborhoods to create thriving communities. We are excited to work with businesses interested in taking advantage of the Salem Loan Fund to provide more economic development opportunities within the community to help it grow and thrive. We provide free one-on-one consulting and technical assistance services with a focus on immigrant-, women-, and minority-owned businesses. We strive to ensure these businesses have the opportunity and equitable access to programs like the Salem Loan Fund.”
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. In addition, the Essex County Community Foundation will provide a 10% 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. The Salem Small Business Loan Fund represents what is possible through collaboration, a shared vision and a shared investment.
“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. “Entrepreneurism and small business ownership are critical drivers of innovation and represent an important path to economic inclusion, yet the pandemic is causing devastating challenges. Access to both capital and technical assistance makes a difference, and we commend the City of Salem, the place where we were founded and have served for over 200 years, and all of the partners involved with this Fund for coming together around a structure to benefit Salem’s small businesses immediately and in the long term.”
Business owners that are interested in the Salem Loan Fund can learn more about it at http://mccinvest.org/salem/.
