LOAN APPROVED TO EXPAND REACH OF NORTH JERSEY MICROLENDER
EDA Board Action Supports Christie Administration Efforts to Spur Small Business Growth and Community Investment
TRENTON, N.J. (March 15, 2012) – The Board of the New Jersey Economic Development Authority (EDA) today approved a $500,000 loan to support the Greater Newark Enterprises Corporation (GNEC), a microlender serving the northern New Jersey small business community. The EDA’s loan requires a commitment of $500,000 in additional capital, stimulating a total of $1 million in new funding for the GNEC.
“Supporting the growth of small businesses is essential to revitalizing communities, stimulating local economies and creating new jobs for area residents,” said EDA Chief Executive Officer Caren S. Franzini. “With this loan, the EDA is able to strengthen the lending capacity of the GNEC and further expand the state’s support of small, women and minority-owned enterprises.”
Formed in 2007, the GNEC is a certified Community Development Financial Institution (CDFI) that provides financial assistance and training to small businesses in a variety of areas, including financial literacy for entrepreneurs, business planning and business management across a myriad of industries. GNEC has graduated more than 150 individuals from its entrepreneurial training curriculum, and has provided approximately $1.5 million in financing to small businesses throughout northern New Jersey. Of the loans provided, 93 percent were to minority-owned enterprises and 70 percent of those businesses were located in underserved communities.
“With a strong commitment and dedication to assisting small businesses, the GNEC provides financing that makes a remarkable contribution to the development of new businesses and to the expansion of existing businesses,” said GNEC Executive Director Mike Wall. “These borrowers could not qualify under regular banking requirements, but because of the GNEC lending activities, small businesses are opening and expanding in northern New Jersey. EDA’s loan will help ensure we are able to continue to provide that critical support.”
The Loan to Lenders program, targeted to established CDFIs, is funded with $3 million from New Jersey’s State Small Business Credit Initiative federal allocation, announced by Governor Chris Christie last October. Through the Loan to Lenders program, GNEC was approved for a $500,000 loan with a fixed interest rate of two percent. The 15 year loan will require interest-only payments for the first five years. The proceeds of the loan will be lent to small businesses in northern New Jersey. The GNEC expects the loan to generate 40 new permanent jobs.
The Christie Administration has demonstrated an unprecedented commitment to growing business in New Jersey. The EDA is part of the state’s results-driven Partnership for Action. Created by Governor Chris Christie and led by Lieutenant Governor Kim Guadagno, the Partnership is the hub for all economic development activity in New Jersey. It is comprised of three interconnected and highly focused organizational elements, which include Choose New Jersey, Business Action Center, and EDA. The Partnership’s goals include attracting new business, and helping existing businesses thrive, in New Jersey by focusing on relationship building and person to person outreach, promoting the state’s incentives and resources, developing pro-growth policies, and assisting businesses in navigating state government and programs.