Community Development Financial Institutions (CDFIs) may have the flexibility to create new loan products to better serve their communities. Concessionary loan capital is one such type of new loan product.
Concessionary loans are loans that offer more generous terms than market rate loans. These terms may be lower interest rates, a longer pay-back period, or grace periods (source). This allows different kinds of borrowers to access capital at terms that are affordable and offer the flexibility that borrower requires.
Main Street Launch has developed concessionary loan products in partnership with grantors and municipal partners. In partnership with JPMorgan Chase, Main Street Launch developed a 3.5% fixed interest rate loan product for loans up to $50,000 to small businesses in Oakland impacted by the ongoing East Bay Bus Rapid Transit (BRT) construction. The majority of the businesses impacted operate in East Oakland along International Boulevard, and these businesses tend to have relatively small revenues and low margins. Thanks to our Community Economic Development Grant (CED), Main Street Launch has been able to offer another 3.5% fixed interest rate loan product to small businesses who will create new full-time jobs in Oakland. In partnership with the City of San Francisco, Main Street Launch developed another 3.5% fixed interest rate loan product for loans up to $50,000 to small businesses operating in the City’s Invest In Neighborhoods. This product has allowed us to concentrate outreach and services in the neighborhoods where businesses need the most support. This flexible capital allows the business owner to invest in their business to strengthen strategies that will help them survive their current challenges and thrive in the future. Click here to inquire about what loan products may be available for your Oakland, San Francisco, or veteran-owned small business.
CDFIs serve communities and innovate to meet the demands of their clients. Click here to find your local CDFIs.