6/22/2011 - Asheville businesses may see more lending under new state fund
by Dale Neal - Asheville Citizen Times
SMALL BUSINESSES ARE KEY TO THE ECONOMY OF WESTERN NORTH CAROLINA!!
ASHEVILLE -- Entrepreneurs across North Carolina having a hard time getting banks to back their new businesses may find better luck with a new $46.1 million state reserve to back loans.
The 300 members attending the annual conference of the N.C. Economic Developers Association that wrapped up Thursday at the Grove Park Inn heard a lot about the N.C. Capital Access Fund, a new financial tool that could help them boost businesses and hire more people in their communities.
"It's the first of its kind in the nation," explained Dale Carroll, deputy commerce secretary and the former president of AdvantageWest. The federal funding for the program was approved under the Small Business Jobs Act of 2010 and is available in all 100 counties of North Carolina. The program is expected to result in $800 million in business loans at a time when many entrepreneurs say banks have been reluctant to lend to small businesses.
Some 52 banks have agreed to participate in the program, including Asheville Savings Bank, Blue Ridge Savings and Champion Credit Union in Western North Carolina.
Entrepreneurs who could have found capital before the financial meltdown of 2008 brought business lending to a halt want to try again under the new NC-CAP program, said Leslie Scott, of the N.C. Rural Economic Development Center.
Banks still won't take on individuals who aren't credit-worthy, but the reserve will help temper the risk in case of a default.
The N.C. Rural Economic Development Center operated a similar and successful program from 1994-2008. During that time, $3.6 million in the reserve generated $103 million in business loans. A total of 1,850 loans allowed businesses to create or retain more than 27,000 jobs.
Lack of capital has been a major stumbling-block for businesses across North Carolina, conceded Bonnie Renfro, president of the Randolph County Economic Development Corp. and program chairwoman for the NCEDA conference.
"The whole idea of the conference is for folks to take back the ideas that will work in their community. We have to become more innovative to help get entrepreneurial growth back on track," Renfro said.
For more information, click on www.nc-cap.org.