NEW ORLEANS – The New Orleans Business Alliance (NOLABA), the City of New Orleans, and other partners, including LiftFund, NewCorp, Inc., and TruFund Financial, have announced a major new initiative to support the capital needs of local small businesses during and beyond the COVID-19 pandemic. The InvestNOLA COVID Relief Loan Fund announced during today’s press conference and webinar was made possible through a $2M investment from the City and additional funding from the InvestNOLA Community Development Financial Institutions (CDFI) Consortium.
This new loan program will provide critically needed capital for businesses located in Orleans Parish. Business owners can apply for loan amounts between $10-50K at 6% APR with loan terms up to five and half years to ensure their growth and recovery through the pandemic. The first six months of payments may be deferred, and the final 10% of the principal loan amount will be forgiven at the end of the loan term.
While Congress passed the $349B CARES Act and Paycheck Protection Program (PPP) in March 2020, many local small businesses were left unfunded and unserved by the program, necessitating an additional $310B in funding and earmarking approximately $30B for CDFIs. While more minority-owned, small, and micro businesses received funding in Phase 2 of the PPP program, many did not as a result of the complex design and numerous program changes that were implemented throughout its duration. Additionally, their most pressing financial needs were not always consistent with the PPP or other federal loan funding guidelines, resulting in a serious lack of available resources during their greatest time of need.
Since the onset of the pandemic, NOLABA has worked tirelessly with the City and its CDFI partners to meet the needs of New Orleans’ businesses, with a special focus on businesses located in disinvested neighborhoods and those owned by people of color and women. Those efforts included the launch of its virtual InvestNOLA Fall Training Series, a free, five-part business course adapted from its award-winning InvestNOLA program that provided critical insights for business sustainability. The launch of the Resilient Corridors Initiative assisted businesses located in Impact communities served by NOLABA’s Strategic Neighborhood Development programming through grants and customized technical and professional services.
As part of that ongoing commitment, the launch of the InvestNOLA COVID Relief Loan Fund will help address the existing funding gaps and provide the necessary assistance to ensure the survival of New Orleans’ valued small business community in the months and years ahead. Applications will open on Monday, August 16, at 12 PM.
“By partnering with NOLABA and the CDFI Partners, the City of New Orleans is committed to helping our small businesses fully recover from the COVID-19 pandemic. Because small businesses make up 50% of our economic development in New Orleans, it is imperative that we create sources of capital funding that will support these businesses and help them to achieve growth and success both during and after the pandemic,” said Mayor Cantrell. “This relief loan fund will be a positive step in the right direction for small businesses in our City.”
“Our Small Business Team has worked tirelessly to make sure all our local entrepreneurs, but especially those of color, have been able to overcome the unprecedented financial blows of this pandemic,” said Norman E. Barnum, IV, Interim President & CEO of NOLABA. “The InvestNOLA COVID Relief Loan Fund will not only help these critical small businesses keep the doors open, but also catapult them into 2022 with their head well above water to ensure their ongoing growth and expansion in the years to come.”
“Now more than ever, Black, Indigenous, and People of Color and women entrepreneurs need access to resources to reestablish their businesses and develop a pathway to stability and success,” said Janie Barrera, President and CEO of LiftFund. “We are proud to be part of the InvestNOLA Loan Relief Fund, and partner with other leading CDFIs to strengthen diverse small businesses in our community through relief funding and guidance.”
“I am delighted to join the InvestNOLA collaborative for this opportunity to accentuate the impact of our investments in New Orleans through this new loan fund. We look forward to working with the team to provide the much-needed funding to help get New Orleans’ businesses back on their feet,” said James H. Bason, President and CEO of TruFund Financial Services, Inc. “This partnership will enhance our ability to provide loan capital and support to promising small businesses that have been adversely impacted by the pandemic and cannot access adequate levels of affordable capital to re-open.”
To learn more about the InvestNOLA COVID Relief Loan Fund, visit InvestNOLArelieffund.org.