The NJ Capital Access Fund, which will leverage Community Development Financial Institutions and Minority Depository Institutions to offer a working capital loan product to better serve New Jersey-based small businesses, is now open, according to a Tuesday announcement from the New Jersey Economic Development Authority.
Calvert Impact, the NJEDA-designated fund manager, will utilize and match NJEDA’s $50 million investment with State Small Business Credit Initiative funding, for a $100 million fund that supports a New Jersey loan participation program. The SSBCI funds, matched with raised private capital, will be used to purchase up to 80% of every eligible loan by participating community lenders.
“The NJ Capital Access Fund serves as a testament to Gov. Phil Murphy’s unwavering commitment to supporting New Jersey small businesses by increasing access to much-needed capital in the wake of the pandemic and recent inflationary pressures,” NJEDA CEO Tim Sullivan said. “This program, which is being administered by Calvert Impact on behalf of the NJEDA, will bolster community lending infrastructure and provide a streamlined path for small businesses in need of loans, helping revitalize a core component of our state’s diverse economy.”
Designed by the NJEDA to meet the needs of small businesses and nonprofits throughout New Jersey, the NJ Capital Access Fund will help serve a larger amount of New Jersey businesses by leveraging a technology platform through the Community Reinvestment Fund USA.
The Capital Access Fund will work alongside six CDFI partners to offer working capital loans up to $250,000 to businesses that have been operating for at least 12 months, with a revenue of $10 million or less and fewer than 50 employees. The loan program will offer flexible features, including no minimum credit score or collateral requirements, terms from 36 to 60 months, low fees to borrowers and competitive fixed interest rates. Full details, including eligibility requirements and preapplications, can be found here.
Calvert Impact is a nonprofit organization primarily focused on financing sectors ignored by mainstream capital markets and has been supporting community and economic development organizations for nearly 30 years.
“Small businesses across New Jersey deserve access to capital to support their continued growth,” Beth Bafford, Calvert Impact’s vice president of strategy, said. “We are excited to partner with NJEDA and our CDFI partners to bring this innovative public-private partnership to New Jersey’s smallest businesses, which are vital to the character of their communities and the vibrancy of their local economies.”
Financing for the NJ Capital Access Fund is allocated from $255 million in federal SSBCI capital allotted to the state of New Jersey by the U.S. Department of the Treasury. The NJEDA is utilizing the funding to create six programs that provide financial assistance to small and microbusinesses in New Jersey.