PROVIDENCE – Fourteen financial institutions have been recruited by BDC Capital Corp. to partner in the Capital Assistance Program, according to a BDC Capital press release on Wednesday.
The CAP is a program designed by the R.I. Commerce Corp. that designates state funds to bolster collateral coverage for banks and credit unions up to $750,000 to Rhode Island businesses with fewer than 200 employees, thereby mitigating bank and credit union risk when lending to small local businesses. BDC Capital, chosen by RICC, will offer the loans through their selected partners. According to a representative, BDC was chosen to run the program in February 2016 and has backed the program with $1.9 million in funds.
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PBN reached out to Commerce to ask how much of the collateral enhancement is provided by the state. No one from that office was immediately available for comment.
Under the CAP, small businesses and the financial partners of BDC will independently negotiate their own terms of the loan.
“We’re happy with the progress we’ve made to date. We recognize, as the governor and the legislature did, that growing community-based businesses are vital to the Rhode Island economy,” said Kenneth J. Smith, president of BDC Capital Corp., in a statement. “With these partner banks and credit unions on board, we can begin the important process of loaning money to companies who would like to grow their business here in Rhode Island.
The participating lenders are as follows:
- Bank Five LLC.
- BayCoast Bank
- Bristol County Savings Bank
- Coastway Bancorp
- Centreville Bank
- Citizens Financial Group Inc.
- Dean Bank
- Freedom National Bank
- Home Loan Investment Bank
- Navigant Credit Union
- People’s Credit Union
- Radius Bank
- Rhode Island Capital Corp.
- The Washington Trust Bank
BDC Capital is headquartered in Wakefield, Mass., but has an office in Providence. According to the BDC website, it has invested in over 6,000 businesses.
Chris Bergenheim is the PBN web editor.
