Helping small businesses get the loans they need to expand and grow





If you ask small business owners what their biggest needs are, they usually revolve around funding. The Delaware Division of Small Business (DSB) can help through its State Small Business Credit Initiative (SSBCI). In 2023, Delaware received $60.9 million in federal funds for four programs; two of which support small business loans: o Delaware Loan Participation Program, the Delaware Capital Access Program.

SSBCI’s aim is to provide loans so that small businesses, especially those in underprivileged or economically and socially disadvantaged areas, can expand and grow. The funds are intended for those companies that need access to capital, but fall behind on one or more credit metrics, such as lacking collateral or having a short credit history.

SSBCI funds may be used for any business purpose, including start-up costs, working capital, franchise fees, equipment, inventory, and the purchase or improvements of an eligible place of business.

“SSBCI is an important component in our suite of programs and financial incentives,” he said DSB Director Regina Mitchell. “Through it, we are able to address the vital need for small business financing and create a network of partnerships with financial institutions across the state.”

How it works

To get started, the small business owner should contact DSB to speak to one of our four Regional Commercial Managers (RBM). RBMs review minimum qualifications for loan programs, which determine whether the small business is easily qualified. If so, the RBM will connect the homeowner with one of our participating lenders. There are currently three participating lenders, Del-One Federal Credit Union, True Access Capital and Community Bank Delaware.

If the lender also believes that the business owner qualifies for one of the programs, DSB is contacted and the Division helps provide the lender with the support necessary to get the loan approved.

But we know some small business owners aren’t quite ready for the bank. In April 2024, DSB awarded the Small Business Development Center (SBDC) a technical assistance contract to provide one-on-one support to business owners who need a little more assistance. In these cases, one of DSB’s business managers will refer the homeowner to the SBDC so that they are better prepared and in a stronger position to qualify for one of the loan programs. Once the homeowner completes their work with the SBDC, they will be referred to participating lenders.

The Programs

Delaware Loan Participation Program (DELPP)

The DELPP is most suitable when a credit institution may not cover the full amount of the requested loan. DSB can support the credit institution up to 50% of the loan amount. New! In July 2024, DSB lowered its lending rate to 5%, with additional reductions of 1% each for selected companies. The lender’s rate is blended with the DSB rate, resulting in a lower interest rate for the business owner.

Delaware Capital Access Program (DCAP):

The DCAP program uses a risk pooling concept to reduce the lender’s risk in the event the borrower defaults on the loan, thereby increasing the borrower’s chances of getting funded. Here, multiple borrowers within the same lending institution contribute premium payments to a reserve fund that the lender can use as collateral to back a loan.

Most Delaware small businesses, including corporations, partnerships, sole proprietors, independent contractors, nonprofits, and cooperatives are eligible for these programs.

Information on all SSBCI programs, information sheets and lender registration forms can be found at de.gov/ssbci.

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