The Small Business Administration expands clean energy loan program
NEW YORK (AP) — The Small Business Administration is looking to attract lenders to finance small businesses’ clean energy projects.
The SBA doesn’t give out loans itself. Instead, it works with lenders to offer small businesses loans that often carry lower interest rates than traditional loans.
The SBA wants to bring in lenders ranging from hyperlocal microlenders to nationally oriented financial institutions. Lenders can apply to become a microlender — offering loans up to $50,000; a Certified Development Company, which is a nonprofit focused on economic development of its community; or Community Advantage Small Business Lending Company, or CA SBLC, which is a non-bank lender focused on “mission driven” projects.
New applications for CA SBLCs will be accepted soon. The SBA is increasing the cap for loans from active CA SBLCs to $500,000 from $350,000. And it is introducing an application process where the CA SBLCs can apply to offer even bigger loans -- up to $2 million to finance climate-related projects.
“Small businesses and homes account for more than one-third of U.S. emissions, so it is vital that they are part of the solution” said SBA Administrator Isabel Guzman. The new initiative will help more mission-driven climate lenders leverage the SBA federal loan guarantee programs to fund the clean energy transition, she added.