California launches fund to help small businesses

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SACRAMENTO, Calif. (KRON) — This year has been especially difficult for small businesses across California.

Wrestling with changing restrictions, closures, demands and lost dollars — small businesses across California need help.

“Obviously this has been a tremendous impact on them as they struggle to survive and thrive through COVID.”

“Approximately how many small businesses in the state have had to close?”

“Across the board, based on most surveys and data we’ve seen, it’s about 1/3 to half depending on the specific population and industry,” Isabel Guzman, director office of the small business advocate said.

In an effort to keep more from collapsing, the state late last week launched the California Rebuilding Fund.

This was recommended by a large economic recovery task force Governor Newsom assembled early on in the pandemic.

For small businesses that are under-banked, the fund will provide applicants up to $100,000 in loans using a blend of state and private money.

“When they apply they go through a matching process for eligibility, once they’re matched they’re with a community lender and they’ll go through an underwriting process and once approved, they get a loan,” Ibank Executive Director Scott Wu said.

Fund organizers say in its first day and half, 1,400 California businesses applied. 1,100 of them are matched, processing $75 million in loans.

The state put up $25 million so far for the fund, with the private sector providing an indefinite amount of money.

The application window is open until the end of next year.

“This is unlike other programs that have a short window, people have to rush in before funds are exhausted. this program will keep raising capital as long as there continues to be a need,”

As Governor Newsom puts together his version of the state budget, he said supporting small businesses is one of his top priorities.

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