Image via Chester County Economic Development Board.
A week after Pennsylvania Governor Tom Wolf announced $268 million in US bailout funding to help small businesses, the Chester County Economic Development Council (CCEDC) worked to detail how these funds will benefit small businesses in eight eastern Pennsylvania counties.
Nearly $20 million of this funding is for the new Eastern Pennsylvania Regional Loan Fund, which the CCEDC administers. Called the Pennsylvania Catalyst Loan Fund, CCEDC has received the highest funding allocation of any certified economic development corporation in the state. CCEDC Pennsylvania Catalyst Loans will be underwritten and approved by CCEDC for all business applicants in Berks County, Bucks County, Chester County, Cumberland County, Dauphin County, Delaware County, Lebanon County and Perry County.
The Pennsylvania Catalyst Loan Fund offers fixed interest rates that are lower than prevailing bank interest rates. Loans typically range from $50,000 to $500,000, and the loan application process is expected to begin November 1, 2022. Business owners should begin preparing the necessary documentation, including a business plan, business projections financials, market research, major sales targets, an accountant and a lawyer. information.
“What’s really exciting about this loan program is that we’re able to help businesses and industries that we haven’t been able to serve before, and on top of that we can also provide support. direct technique to help borrowers qualify for financing,” said Chris. McHenry, CCEDC’s Vice President of Development Finance. “Previously, we weren’t able to offer loans for working capital and inventory, or lend to the retail sector unless they owned their building. This will be a real help for high street businesses that would not normally qualify for traditional loans. »
“We are thrilled to receive these funds through the Pennsylvania Small Business Credit Initiative and are inspired by the collaboration with our colleagues in southeastern and central Pennsylvania, which benefits the entire region,” said Gary Smith. , President and CEO of the CCEDC. “This award will allow us, in partnership with five economic development partners spanning seven other counties, to make critical investments in local small businesses of all kinds as they continue to grow and recover from the pandemic and its impacts. economic. In particular, expanding access to credit for socially and economically disadvantaged groups is a priority for our organization. We are delighted that this program, which will provide loans to small businesses at fixed interest rates below market rates, will allow us to make these investments on an even larger scale.
Business situations that could benefit from this include a store that wants to grow by buying inventory, buying equipment like shelving, and hiring more workers. A payback on this investment can take several months, and a Pennsylvania catalyst loan can help bridge that gap. Working capital can also be spent on things like vehicle upgrades, advertising, building materials, and renovations.
“We are looking for business owners with positive operating histories or entrepreneurs with solid business plans. It takes documentation and research to demonstrate that, and now is the time to start,” McHenry said.
Pennsylvania Catalyst Loans require a match with a partner lender, with borrowers providing up to 20% equity. Loan terms can be up to five years. For questions and initial assistance, each business should contact their county’s Certified Economic Development Organization:
Berk County: Greater Berks Development Fund – 610-376-6739
Bucks County: Bucks County Economic Development Corporation – 215-348-9031
County of Chester: Chester County Economic Development Board – 610-458-5700
Cumberland County: Capital Region Economic Development Corporation – 717-232-4099
Dauphin County: Capital Region Economic Development Corporation – 717-232-4099
Delaware County: Delaware County Economic Development Supervisory Board – 610-566-2225
County of Lebanon: Lebanon Valley Economic Development Corporation – 717-274-3180
Perry County: Capital Region Economic Development Corporation – 717-232-4099