According to the Hartford Business Journal, Hartford Economic Development Corp. Inc. is accepting applications from city-based businesses with five or fewer employees who want to borrow from its newly established $500,000 micro-loan pool, authorities say.
HEDCO was certified Thursday as a Connecticut intermediary lender under the U.S. Small Business Administration's Microloan program.
The SBA certification qualified HEDCO to receive a $500,000 SBA loan that the agency will repackage into smaller term financing to qualified Hartford-based businesses only, said Samuel C. Hamilton, HEDCO's executive director.
The program is an offshoot of President Barack Obama's jobs stimulus package passed last September to boost U.S. employment, officials said.
Although HEDCO has other small-business financing programs for local businesses, the microloan financing program is a first for the agency, Hamilton said.
"The idea is to be able to make loans of less than $50,000 to microbusinesses ... that may find it difficult to find financing elsewhere,'' Hamilton told HBJ Today Thursday.
Micro-businesses are defined, Hamilton said, as those with five or fewer workers; for example neighborhood groceries/bodegas, retail shop and boutiques, service enterprises and startups.
HEDCO's micro-business loans will carry an interest rate between 4 percent and 6 percent, he said. HEDCO will use repayments to repay its SBA borrowing that bears an interest rate below 2 percent.
Congressman John E. Larson, D-1st District, along with Hamilton, attended a brief ceremony Thursday at a business in Hartford's North End, announcing HEDCO's enrollment in the SBA Micro-Loan Program.
"... The generous loan of $500,000 from SBA to HEDCO will go a long way in helping the group continue their important work in promoting small business growth in our region," Larson said in a statement.
For more information, visit www.hedco-ct.com or call 860-527-1301.