Small businesses in North Carolina will soon get a financial boost from the federal government. The US Treasury Department announced that it had approved the request for state funding under the State Small Business Credit Initiative (SSBCI).
North Carolina is now set to receive up to $202 million to “promote small business growth and entrepreneurship.” The SSBCI program is funded by the federal COVID-19 relief program known as the US Rescue Plan.
The state’s small business credit initiative has been reauthorized and expanded with $10 billion in funding by @POTUSUS rescue plan. I am in North Carolina today to meet with recipients of SSBCI funds and announce over $200 million in additional support for small businesses in North Carolina. https://t.co/XUuE14DX8Q
— Deputy Secretary Wally Adeyemo (@TreasuryDepSec) July 29, 2022
According to a statement from the federal Treasury Department, North Carolina will use the funds to “operate three different programs, including a loan participation program to which it has allocated $160 million.”
The state has partnered with the NC Rural Center to administer the program in an effort to help support “small business recovery” and “revitalize central business districts,” according to the Treasury.
Just Announced: NC Rural Center has been authorized to administer the second award of State Small Business Credit Initiative (SSBCI) funding allocated under the U.S. Federal Bailout Act ( ARPA) as part of the FYS 2021-2023 budget.
— North Carolina Rural Center (@NCRuralCenter) July 29, 2022
In North Carolina, there were more than 170,000 new business apps in 2021 alone. According to the latest census data, that’s double the figure from just four years prior. About 32% of employed people in North Carolina work in companies with fewer than 100 workers, according to the census.
But these start-ups, especially in underserved communities, can struggle to access capital. The state’s small business credit initiative should provide some relief to these newcomers.
A boom in new small businesses is happening across the country, President Biden said during Small Business Week last month.
“We saw companies with fewer than 50 workers add jobs last year at the highest rate on record,” Biden said.
The Federal Seed Loan is intended to help businesses leverage this funding into larger loans from financial institutions to grow sustainably.
Laura Pellicer of WUNC contributed to this report.