TD Bank is establishing a $100 million equity fund to support minority-owned small businesses, it announced this week.
The Cherry Hill-based bank said in a news release that the funding will enable Specialized Small Business Investment Companies and Community Development Financial Institutions to provide small business loans to firms in underserved communities.
“The pandemic has highlighted the depth of disparities that exist in communities of color, especially as it relates to small businesses, which serve as the backbone of our economy,” CEO and President Greg Braca said in a prepared statement. “The equity fund will ultimately infuse capital and help stabilize these small businesses.
“But it’s also about contributing to job creation, stimulating economic development, revitalizing these vibrant communities and, just as important, breaking the cycle of disinvestment which systemically prevents communities of color from thriving. Small businesses are the heart of our communities — especially communities of color — and it’s up to us to help them succeed.”
The first $75 million of the capital will be funded through an SSBIC initiative, which will be launched later this year, TD Bank said. SSBICs provide financial assistance to disadvantaged businesses that are minority- or women-owned or in areas of need.
The other $25 million will be specifically earmarked for Black- and Latinx-owned small businesses, funded through CDFIs, which help businesses in communities of color secure financing.
“We hope that our investment in these SSBICs and CDFIs serves as a means of making access to capital more equitable for minority small business owners,” Michael Innis-Thompson, head of community lending and development, said in a statement.