|
PIDC Emerging Business Loan Program
BACKGROUND
The Emerging Business Loan Program provides working
capital financing and technical assistance services to minority, women-
and disabled-owned businesses in Philadelphia. Loans will typically
fund the short-term liquidity needs associated with contracts to provide
construction or procurement services to creditworthy clients. Technical
assistance services to support financial capacity and business growth
will be required as a component of the Emerging Business Loan Program.
USES
Use of funds is restricted to working capital and
equipment costs directly associated with the contract being financed.
FINANCING
Short-term financing will be targeted to qualified emerging businesses
that have been awarded contracts with creditworthy clients, often related
to an Economic Opportunity Plan with specific contract goals.
- Loan Amount: $75,000 to $500,000.
- Interest Rate: Approximately 2.75%
- 3.25% Variable Rate
- Collateral: Financing will not exceed 80%of the dollar value
of the contract being financed. Collateral requirements for
the loan may include contract assignment, a secured lien position
on business assets, as well as the corporate or personal guaranty
of the borrower.
PROCESS AND TIMING
Applicant will submit an application for financing
and meet with an approved technical assistance provider for an initial
assessment. Loan applications are then underwritten by PIDC staff and
approved by PIDC’s Loan Committee and Board of Directors. Technical
assistance services will be customized for each borrower. Once all
approvals are obtained, a commitment letter will be issued. Settlement
of the loan may occur once the terms of the commitment are satisfied.
The transaction cycle is 90-120 days.
FEES
- Application: $500 – credited to
the borrower at settlement.
- Origination: 1.5% of the principal amount
of the loan, due at settlement.
- Legal: Maximum of $2,500, due at settlement.
For more information, contact Susan Lowry, 215-496-8161,
slowry@pidc-pa.org .
|