The 2008 financial crisis had a devastating effect on our nation’s community banks. Many closed or were bought out by larger banks. These banks were traditionally the lifeblood of small business funding. Now, it is harder than ever to find any funding to start or grow your business. I want to change this with a new plan that I a debuting today.
How the plan will work:
The state would set aside $10 million in funding each year to back funding. Potential small business owners would sign up for a free business mentoring program offered through the Small Business Administration called SCORE. The owners would develop a business plan with their mentor as well as completely flesh out their business idea. They would then attend a basic small business course through their local community college to learn the basics of budgeting and the like. Once these tasks are completed, they can then apply for a low-interest loan through participating banks. The loans would max out at $10,000 and the banks would have discretion on issuing the loan based on the business plan and availability of the funding remaining. The loans would have a generous payment schedule so that it doesn’t stifle the fledgling business.
The general idea here is that this would model how student loans are issued, except of course this is for small businesses. The goal is to have more small businesses launching in our state and thus more jobs and economic prosperity.