Centers Will Connect Small Businesses to Lending Programs and Will Prepare Them to Successfully Take on Larger Loan; Builds on the Success of the City’s Microloan Program
CHICAGO—(ENEWSPF)—October 31, 2014. Mayor Rahm Emanuel and the City of Chicago Department of Business Affairs and Consumer Protection (BACP), in partnership with Accion Chicago and World Business Chicago, today launched Capital Access Centers (CACs), a six-month pilot program that will help small businesses access the capital needed for growth. The Capital Access Centers will primarily work with small businesses seeking loans between $25,000 and $250,000. Two years ago Mayor Emanuel launched the Chicago Microlending Institute to help businesses access loans up to $25,000. Capital Access Centers will help address the capital need for small businesses at the next stage in their growth.
“Small businesses are the backbone of our economy and they should have access to every tool in our toolbox to ensure that they can not only open their doors, but grow and thrive in Chicago,” Mayor Emanuel said. “Capital Access Centers will build on successful programs like the Microlending Institute and Small Business Center already in place that help entrepreneurs and small businesses access financing, secure business licenses and receive mentoring. Providing these services enables us to help local businesses grow, driving the economy forward and bringing new jobs to Chicago’s neighborhoods.”
Capital Access Centers will help banks, microlenders, and other financial institutions fill their lending pipelines, while providing the expert guidance business owners seek when they are looking for financing to improve or expand their business. The centers will provide mentorship, refer owners to programs such as Goldman Sachs’ 10,000 Small Businesses, and help with the assembly of loan application documents and referral to credit repair specialists.
The CACs will act as the intermediary between banks, community resources, and businesses and serve as one-stop-shops for businesses looking to expand in their neighborhoods. CACs will familiarize small business owners with lenders, products and the application process. They will work one-on-one with the owners of small businesses to identify business needs and refer them to the right lending partners, enabling them to start-up and grow.
“Accessing capital is one of the most important needs for small businesses and is also one of the most challenging,” said Roxanne Nava, Chief Small Business Officer for the City of Chicago. “Often, small businesses don’t know where to go for capital and currently there are limited institutions providing support to them in the market place. This program will provide funding and training to create centers that have both the capacity and the capability to triage client needs and steer them to the most appropriate financial partners.”
The Program will launch with three agencies: the Chatham Business Association, The Resurrection Project, and The Greater Englewood Community Development Corporation. The agencies are in areas that are historically underrepresented by business borrowers, but they will not be limited by the geography of their service area and will be able to receive and manage referrals that cover the entire City.
“A key component of Mayor Emanuel’s Plan for Economic growth and Jobs, which World Business Chicago is currently implementing, is to foster growth within Chicago’s neighborhoods,” said World Business Chicago President & CEO Jeff Malehorn. “Connecting our city’s small businesses with the resources they need to succeed through Capital Access Centers will help accelerate growth and create jobs throughout the City.”
According to the National Small Business Association, 35 percent of small businesses struggle to get access to capital, which decreases opportunities for growth. Small business has lagged behind mid-size business growth, yet small businesses employ about 50 percent of the private sector workforce in the United States.
“Supporting Capital Access Centers continues to build on Citi Community Development’s support of the Chicago Microlending Institute and we are delighted to provide seed funding for the necessary training and technical assistance to key strategic nonprofits in partnership with the City of Chicago” said George Wright – Midwest Director – Citi Community Development.
The Capital Access Centers program is the newest program in a suite of services launched by the City to help small businesses and entrepreneurs succeed. CACs will be scaled city-wide by adding three additional centers in the next year. The City of Chicago is seeding the program, with Citibank as a founding partner.
Since 2011, Mayor Emanuel has instituted a number of reforms to help support small business growth and entrepreneurship in the City of Chicago. In April 2013, Mayor Emanuel launched the Department of Business Affairs and Consumer Protection’s Small Business Center (SBC), located at City Hall, 121 N. LaSalle St., Room 800 to provide a one-stop-shop for small businesses. The Small Business Center (SBC) has reduced overall wait times by fifty percent and 25 percent of all customers are in and out of the Center within 15 minutes.
Other services available to support small business growth include Seed Chicago, the City’s curated Kickstarter page, managed by Accion which, to-date, has raised more than $300,000 for local businesses, and the Chicagoland Microlending Institute, a program that has distributed $1.4 million in loans to 157 businesses and has become a model for other cities looking to launch microloan programs.
Learn more about the City of Chicago’s business resources at www.cityofchicago.org/SBC.