NJEDA unveils picks for community lender COVID-19 business relief program
As demand for state and federal aid programs vastly outstrips the funds available for businesses that have been ordered to shutter their doors, the New Jersey Economic Development Authority is moving ahead with its third aid program from a $41 million pot of money meant to support certain businesses that are taking an economic hit amid the COVID-19 pandemic.
EDA officials said they picked six community lenders, known as community development financial institutions, that would contribute a combined $20 million to $30 million to struggling businesses that have seen their commerce plummet during the pandemic under the “CDFI Emergency Loan Loss Reserve Fund.”
The agency would set aside $10 million to provide guarantees of up to 50 percent of the loan amount so that the banks are guaranteed at least half that amount if the companies default on their borrowing.
The EDA picked New Jersey Community Capital, Regional Business Assistance Corporate, Cooperative Business Assistance Corp., UCEDC, the First Bergen Federal Credit Union and Greater Newark Enterprise Corp. to take part in the loan program.
Businesses will apply directly to the CDFI’s, each of which will develop its own timeline and eligibility requirements.
Each program is geared toward small businesses and micro-sized companies, which often have up to 10 employees.