New Fund Launched To Give Minority-Owned Small Businesses A Lifeline
By Victor Ochieng
Economically speaking, African American communities are doing badly. That’s why several organizations and individuals are starting projects to help the Black community generate wealth and compete with other American demographics.
Yes, that’s also the reason why a small business lending initiative, Capital Access Fund of Greater Cleveland, was launched. The program aims at helping small minority-owned businesses to create jobs and generate wealth. A number of organizations, including Morgan Stanley, National Urban League’s Urban Empowerment Fund, Cuyahoga County and National Development Council, came together to support the initiative as a way to positively transform the targeted businesses.
CAF, a three-year program, seeks to disburse loans to the tune of $8 million. Besides availing funds, the initiative also provides both pre and post-loan counseling for greater impact. Over the three-year period, CAF has purposed to generate at least 300 jobs, and so far, $1.4 million has been disbursed and 70 jobs have either been created or maintained.
“The level of interest we already have confirms what we already knew—there is a gap in the access to capital for minority businesses, and we should not gloss over that,” president and CEO of the National Urban League, Marc H. Morial, said in a statement.
Blacks, among other minorities, find it hard securing loans for their businesses. That’s why CAF has a bigger goal of spreading its services to other cities across the country. This is in a bid to ensure that small minority-owned businesses secure the much needed funding.
Don Bowen, who heads the Urban League Empowerment Fund, said the fund “allows the National Urban League to build upon its legacy role, as a social service intermediary to become a financial intermediary. It’s another tool to help impact local communities and advance the mission of promoting economic parity.”
The Community Impact Loan Fund is a new product established by the NDC, with a support of $2 million from Morgan Stanley. The Grown Cuyahoga Fund on the other side is receiving $2.5 million in funding from Cuyahoga County.
“We are proud to partner on this program, with $2 million in startup capital for the Community Impact Loan Fund,” added Carla A. Harris, vice chairman of Global Wealth Management and head of the Multicultural Client Strategy Group at Morgan Stanley, in a released statement. “By providing small businesses with access to capital and flexible terms that lead to opportunities for these businesses to scale up, affords them the financial stability necessary for entrepreneurs to focus on their customers and contribute jobs to the local economy.”
Besides the support from Cuyahoga County, Key Bank Foundation has also pledged to support CAF, coming forth as the lead local program funder. Other local organizations extending support to CAF are Burton D. Morgan Foundation, City of Cleveland, PNC Bank and Fifth Third Bank.
“We are proud of our local funders, who have met the challenge to support a program that offers a long term, sustainable solution for local African American and other minority entrepreneurs when pursing capital,” noted Marsha Mockabee, president of the Urban League of Greater Cleveland.