CDFIs: ‘California Rebuilding Fund’ Launched for Small Businesses

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California Governor Gavin Newsom has announced the opening of the California Rebuilding Fund to help impacted small businesses rebuild from 2020’s economic crisis and aid local economies.

Simultaneously, "credit unions" were top-of-mind with the governor yesterday as he discussed the state's recently launched California Rebuilding Fund in a news conference, as well as COVID-19 and other updates (click to view a PBS News Hour broadcast clip). While his immediate mention of credit unions is a noteworthy spotlight in the news media and public, the positivity behind Newsom's reference was also the product of all the hard work the California Credit Union League has invested in engaging with he and his staff, as well as the credit union movement's outstanding outreach to members and consumers in their local communities over the past year.

The fund is a public-private partnership that drives capital to Community Development Financial Institutions (CDFIs). It will give California credit unions that are CDFIs and serve under-banked small businesses another opportunity to help those businesses recover and reposition to survive the COVID-19 marketplace.

Credit unions and other lenders participating in the program will offer a standardized lending product with loan sizes up to $100,000. These loans are meant to be timed and structured to support businesses that are adapting and face upfront or ongoing expenses to operate safely in a post-COVID economy.

Local interested small business owners can fill out a pre-application with a participating community lender by visiting this webpage (and clicking “Apply Now”). This pre-application uses lender parameters to pre-screen for basic eligibility and a local CDFI lender match. If eligible, they will be redirected to a full loan application. Loans will need to be paid back over 3 – 5 years with a fixed annual interest rate that is currently 4.25 percent.

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