NALCAB receives $1.5 million in awards to support diverse small business lenders
NALCAB will use the money awarded to them to support small lending groups with training and financial support to grow Latino businesses on a wider scale.
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On May 15, 2023, the National Association for Latino Community Asset Builders (NALCAB) announced that they are the recipient of $1,585,000 delivered over two years from the U.S. Department of Commerce's Minority Business Development Agency (MBDA).
The award will be put to funding grants, training, and technical assistance that will strengthen the capacity of nonprofit small business lenders, providing more affordable capital for underserved Minority Business Enterprises (MBEs) across 24 states, Washington DC, and Puerto Rico.
This is done through NALCAB's Small Business Loan Guarantee Program, a new loan product that seeks to be flexible as it increases the size and frequency of MBE business loans by lowering the overall credit risk of the nonprofit lenders involved.
“To expand access, we need to not only open the doors to traditional funding often closed for minority-owned businesses, but also to construct new gateways to non-traditional capital sources,” said Under Secretary of Commerce for Minority Business Development Donald Cravins, Jr., in a statement.
“NALCAB’s program, funded by MBDA’s Innovative Access to Capital Grant, will do just that, giving nonprofit small business lenders the tools and capacity to be an effective, flexible, and unique source of capital for minority businesses,” he continued.
NALCAB is composed of over 200 member organizations, forming a national network of institutions located within Latino communities.
It supports its members with funding, training, research, and advocacy to allow them to invest in their communities through supporting small business growth, providing financial counseling on housing topics, equitable neighborhood development, and constructing affordable housing.
“Over its 20-year history, NALCAB has worked to address the challenges faced by MBEs in operating and growing a successful business: MBE's have less access to responsible loan products, and if they do receive a loan, it comes with comparatively unfavorable terms and pricing,” said Marla Bilonick, NALCAB President & CEO, in a statement.
"Latino and other entrepreneurs of color are often shut out of the traditional financial system. Therefore, they must turn to alternative, and often uncouth, financial service providers like check cashers and payday lenders to conduct financial transactions, and often with a hefty price tag that further stifles their economic mobility,” she continued.
The six organizations chosen by NALCAB to be supported through the first year of the MBDA grant project are:
- Dorchester Bay Economic Development Corporation: A Boston based real estate development organization focused on improving neighborhoods, individual empowerment, and the promotion of economic justice.
- Hispanic Economic Development Corporation: A Kansas City based company that seeks to improve Latino lives through business development, and economic and community wealth creation initiatives.
- Hispanic Interest Coalition of Alabama: An Alabama based community development and advocacy organization that pursues economic equality, social justice, and civic engagement for Latinos.
- La Fuerza Unida CDC: A New York state based organization that seeks to provide loans and business development tools to diverse and women owned enterprises to create community wealth, jobs, and long-term prosperity in counties Nassau and Suffolk.
- Latino Economic Development Center: A nonprofit that seeks to provide Latinos and other underserved communities with the financial tools and skills to. improve their communities and families futures in the DC/MD/VA region and Puerto Rico.
- TMC Community Capital: A nonprofit microlender that provides online financing and seeks to create financial stability and entrepreneurship among women-owned, low income, or underserved small businesses in California.