DEED launching loan programs for small businesses

Great news for Minnesota small businesses today.

The Minnesota Department of Employment and Economic Development (DEED) announced that it has been awarded $15.5 million in federal funding for programs that will support small-business lending in the state.

The funding, from President Obama’s Small Business Jobs Act, will provide loan guarantees to lenders making loans to Minnesota small businesses, make money available to lenders for direct loans of up to $150,000 and provide seed money for angel investment funds.

“This award is great news for Minnesota businesses, which are having difficulties accessing the capital necessary to expand and provide new jobs in our state,” said Gov. Mark Dayton.  “President Obama’s initiative will mean more jobs for Minnesota.”

"These funds will help break down barriers to loans for creditworthy small businesses looking to invest and hire in their local communities," said U.S. Treasurer Rosie Rios. "This program will help ensure that more Main Street entrepreneurs have access to the credit they need to expand their businesses and create new jobs."

Twin Cities Business magazine also reported on the good news:

According to DEED, agency officials estimate that the programs receiving funding will serve 1,200 small businesses, attract an additional $200 million in private investment, and spur the creation of 3,000 new jobs.

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DEED Commissioner Mark Phillips said in a statement that tighter lending restrictions imposed since the start of the recession have posed challenges for businesses trying to obtain the funding they need to survive during early stages of development.

“These programs will put money into the hands of small-business owners and [give] them an opportunity to grow and create jobs,” he added.