PROVIDENCE – The state’s BankLocal program, which incentivizes community banks and credit unions to lend to designated types of small businesses, is being expanded to include small businesses owned by military veterans.
Under the BankLocal program, the state opens accounts with small banks and lenders and deposits state funds into those accounts equal to the amount that they lend to Rhode Island businesses with 100 or fewer employees. As an added incentive, the state deposits state funds double the amount that they lend to those Rhode Island small businesses owned by minorities, women, or first-time business owners.
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Treasurer Seth Magaziner recently announced small businesses owned by veterans will be added to the latter category.
Since Magaziner started the BankLocal program last year, the state has moved more than $20 million in state funds into the accounts of community banks and credits unions – money that historically was deposited in big national and international banks, his office said. The initiative seeks to help small-business owners receive the financial services they need while also bolstering the deposits of smaller banks and credit unions to help them survive and thrive.
So far, loans have been made to more than 200 small businesses involved the program, his office said.
“Small businesses are the backbone of Rhode Island’s economy, but too many entrepreneurs have a hard time getting loans to grow their businesses and hire more people,” Magaziner said. “That’s why I started the BankLocal program, where we are moving millions of dollars to community banks and credit unions when they make loans to Rhode Island small businesses.”
Veterans-services organizations applauded the move to include veterans in the program.
“Operation Stand Down Rhode Island is proud to support this initiative that not only encourages veteran business owners but enables them by giving them access to the capital they need,” said Erik Wallin, executive director for Operation Stand Down Rhode Island.
“Veterans provide a lot of talent for Rhode Island’s economy,” said Kasim Yarn, Rhode Island’s director of veteran affairs. “That’s why expanding our state’s BankLocal program to support veteran entrepreneurs is good business.”
Scott Blake is a PBN staff writer. Email him at Blake@PBN.com.
