Business loan

In Bridgeport, Lamont unveils $150 million small business loan program

BRIDGEPORT — Starting a business isn’t easy. And according to Deborah Caviness, founder of the Southern CT Black Chamber of Commerceit’s even harder for businesses in underserved communities.

“We work with a lot of small businesses, and their main concern is access to capital,” Caviness said.

But acquiring capital for would-be entrepreneurs may soon become easier. Caviness was on hand Monday at Schwerdtle Stamp Co., a Bridgeport-based tool and die maker, as Governor Ned Lamont announced a $150 million low-interest loan program for small businesses in the whole state. The program, called the Connecticut Small Business Recovery Fundalso has a focus on minority and low-income communities.

The fund, according to the governor’s office, is a private and public partnership between several financial institutions and organizations focused on economic and community revitalization, including the Hartford Economic Development Corp. and the Southeast Connecticut Enterprise Region.The loans are fixed at an interest rate of 4.5%. The fund is part of the Minority Business Initiative which was first launched in 2015.

Lamont said the financial institutions that have signed on as partners are committed to fair lending practices.

“This fund was created to support small business owners who may have previously faced barriers accessing financial support and works with and through community lenders who are dedicated to fair lending practices,” Lamont said.

The fund comes as the state also received $119 million from the federal government to also help women and minority-owned business owners.

Caviness said the program would have a huge impact.

“This one, I think, is going to be a game-changer for minority-owned small businesses,” Caviness said.

The fund accepts applications on its website. But there are conditions. To be considered, a business must have been in operation for at least one year and have no more than 100 employees. Limited start-up loans are available for businesses less than a year old.

Kathy Saint, president and CEO of Schwerdtle, said the company would find the state program helpful.

“We’re always getting new gear, you have to do that to stay competitive,” she said. “We have just redone all our servers. It was $40,000. We have a couple of $250,000 machines that we bought in the last two years.

Department of Economic and Community Development spokesman James Watson said the program was different from other previous efforts because of its focus on private fundraising. David Lehman, commissioner of the DECD, said the state had traditionally handed out money but had come to compete with the banks. Instead, the solution was to work with the banks.

“We work with the private sector, people who are experts in making loans,” Lehman said.

Caviness said the pandemic has made state and local government realize how much help local businesses need to survive. She said she was “very happy that people are finally realizing the critical role that small businesses play in the community, especially the underserved community.”