The South Eastern Economic Development (SEED) Corporation has received a $1 million grant from the U.S. Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund. The grant proceeds will allow SEED to continue making loans of up to $200,000 to small businesses in southeastern Massachusetts and Rhode Island.
“There is no agency in the Congressional District I have represented for which I’ve worked harder than SEED. Its work in economic development is first-rate and I’m very proud to have been an advocate for federal funding for the work they do,” said Congressman Barney Frank of the award.
“We are very pleased to receive this grant from CDFI to assist small businesses in these difficult economic times. The grant will increase SEED’s loan capital base of $5 million and enable us to continue meeting the demand for loans up to $200,000” stated Ferd Kelley, SEED’s chairman.
Maria Gooch-Smith, SEED’s executive director, explained that SEED serves as a gap financier providing loans to small businesses when financial institutions cannot provide financing for a number of reasons, or can only provide a portion of what a small business needs. “With the additional funds, SEED can continue making loans up to $200,000 which small businesses can use for real estate, equipment or working capital,” stated Gooch-Smith.
According to Gooch-Smith, SEED makes loans up to $200,000 with various funding sources and the CDFI grant will augment the capital for these loans. The term on the loans is up to 10 years with longer repayment schedules, as necessary, and the current interest rate is 5 percent fixed. “As long as there is repayment ability, SEED can be flexible with collateral, and personal credit,” explained Gooch-Smith.
So far this year, SEED has closed on 31 small business loans ranging from $9,000 to $120,000. These loans totaled $1.44 million, leveraged $4.69 million in bank financing and private funds, and assisted in the creation of 132 jobs. The loans were made to a variety of small businesses throughout the region including: a Montessori academy, professional services, restaurants, inns, retail stores, child daycare facilities, manufacturers, exercise and dance studios, neighborhood markets, hair salons, and others.
Under the SBA 504 Program, so far this year, SEED has approved 37 loans, and closed on another 35 for a total of $29.8 million. These loans have ranged from $98,000 to $3 million.
The application process for loans up to $200,000 includes filling out SEED’s application form, and providing federal income tax returns for three years for the small business and the owner. The application and list of items needed is available on SEED’s website www.seedcorp.com.
Over the past 29 years, under all its loan programs, SEED has made over 1,700 loans totaling $270 million, leveraging $600 million in private funds, and assisting in the creation of close to 11,000 new jobs.
SEED is a non-profit economic development corporation established and certified by U.S. Small Business Administration in 1982 to assist small businesses in the region. SEED is also a CDFI and makes loans from $1,000 under the Micro Loan Program to $5.5 million under the SBA 504 Program to assist small businesses to grow and create jobs.
SEED also provides technical assistance to small businesses and works with other economic development organizations and financial institutions in the region to ensure that individuals who are committed to owning and operating a small business are able to obtain the assistance they need to be successful.
For more information about SEED’s loan programs, and free entrepreneurial workshops, please call 508-822-1020 or visit SEED at www.seedcorp.com.
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